What is the operating cash flow for first year of project

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Reference no: EM13880590

The Sports Club wants to expand its facility. The expansion will require $350,000 in building improvements that will be depreciated on a straight-line basis over a 10-year period. The expanded area is expected to generate $250,000 in additional sales. Variable costs are 65 percent of sales and the annual fixed costs are $21,000. The tax rate is 28 percent. What is the operating cash flow for the first year of this project?

a. $57,467

b. $57,525

c. $57,680

d. $57,762

e. $57,800

Reference no: EM13880590

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