Transcribed Image Text
A firm is considering the purchase of a machine to produce tincans, which would represent an investment of $38 million, and wouldbe depreciated in a straight-line basis over 5 years. Sales areexpected to be $17 million per year, and operating costs 49% ofsales. The company is currently paying $1 million in interest peryear, has a tax rate of 40%, and a WACC of 10%. What is thecompany’s free cash flow for year 1 of this project?Enter your answer in millions of dollars, rounded to 2 decimals,without the dollar sign. So, if your answer is 4.5678, just enter4.57.
Other questions asked by students
Accounting
Basic Math
Accounting
Accounting
Accounting