What will the incremental cash flow for the project be

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Problem 1: The Amelia Rose Company I installing a new delivery system. The system will cost $115,000 and is expected to provide an increase of $15,000 in revenues each year of its expected 10 year economic life. The system will be depreciated on a straight line basis and will have a salvage value of $12,000 at the end of its useful life. The project will also be more efficient than the current system and will cut cash expenses by $4,000 per year. The firm is in the 38% tax bracket. What will the incremental cash flow for the project be in the first year of the project's life?

Reference no: EM132968677

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