2. A chemical processing firm is planning to add a duplicate polvethylene plant at another...
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Accounting
2. A chemical processing firm is planning to add a duplicate polvethylene plant at another location The financial information for the first project year is shown in Table P2.2. (a) Compute the new working-capital requirement during the project period (b) What is the taxable income during the project period? (c) What is the net income during the project period? (d) Compute the net cash flow from the project during the first year Financial Information for First Project Year Table P2.2 Sales Manufacturing costs $3,000,000 $500,000 500,000 250,000 250,000 750,000 500,000 250,000 150,000 100,000 100,000 100,000 300,000 100,000 Direct materials Direct labour Overhead Depreciation Operating expenses quipment purchase Borrowing to finance equipment Increase in inventories Decrease in accounts receivable Increase in wages pavable Decrease in notes payable Income taxes Interest pavment on financing
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