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What is the operating cash flow of the project

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Question - A project will increase the sales of Karan's Garage by $40,000 and increase cash expenses by $36,000. The project's fixed assets will cost $30,000 and be depreciated using straight-line depreciation to a zero book value over the 3-year life of the project. The company has a marginal tax rate of 32%. What is the operating cash flow of the project using the tax shield approach?

a. $5,920

b. $17,500

c. $8,400

d. $9,100

e. $15,600

Reference no: EM133044227

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