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Problem 10-13 Calculating Project OCF (L03) Hubrey Home Inc. is considering a new three - year expansion project that requires an initial fixed asset investment of $41 million. The fixed asset falls into Class 10 for tax purposes (CCA rate of 30% per year), and at the end of the three years can be sold for a salvage value equal to its UCC The project is estimated to generate $ 2,670,000 in annual sales, with costs of $846,000. If the tax rate is 35% what is the OCF for each year of this project? (Enter the answers in dollars. Do not round your intermediate calculations. Round the final answers to 2 decimal places. Omit S sign in your response.) OCH OCF2 OCT

Problem 10-13 Calculating Project OCF (L03) Hubrey Home Inc. is considering a new three - year expansion project that requires an initial fixed asset investment of $41 million. The fixed asset falls into Class 10 for tax purposes (CCA rate of 30% per year), and at the end of the three years can be sold for a salvage value equal to its UCC The project is estimated to generate $ 2,670,000 in annual sales, with costs of $846,000. If the tax rate is 35% what is the OCF for each year of this project? (Enter the answers in dollars. Do not round your intermediate calculations. Round the final answers to 2 decimal places. Omit S sign in your response.) OCH OCF2 OCT

EBK CFIN
EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter9: Capital Budgeting Techniques
Section: Chapter Questions
Problem 7PROB
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Problem 10-13 Calculating Project OCF (L03) Hubrey Home Inc. is considering a new three - year expansion project that requires an initial fixed asset investment of $41 million. The fixed asset falls into Class 10 for tax purposes (CCA rate of 30% per year), and at the end of the three years can be sold for a salvage value equal to its UCC The project is estimated to generate $ 2,670,000 in annual sales, with costs of $846,000. If the tax rate is 35% what is the OCF for each year of this project? (Enter the answers in dollars. Do not round your intermediate calculations. Round the final answers to 2 decimal places. Omit S sign in your response.) OCH OCF2 OCT

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