Time 127000 127000 20000 147000 147000

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Unformatted text preview: time (127,000) (127,000) + ( 20,000) (147,000) (147,000) + ( 4,000) + 0 ($151,000) ($151,000) purchase price of asset shipping and installation depreciable asset net working capital proceeds from sale of old asset net initial outlay Step 1: Evaluate Cash Flows Step b) Annual Cash Flows: What b) Annual incremental cash flows occur over the life of the project? life For Each Year, Calculate: For Incremental Revenue Incremental - Incremental Costs - Depreciation on project Incremental Earnings before Taxes Incremental - Tax on Incremental EBT Tax Incremental Earnings after Taxes Incremental + Depreciation Reversal Depreciation Annual Cash Flow For Years 1 - 5: For Incremental Revenue Incremental - Incremental Costs - Depreciation on project Incremental Earnings before Taxes Incremental - Tax on Incremental EBT Tax Incremental Earnings after Taxes Incremental + Depreciation Reversal Depreciation Annual Cash Flow For Years 1 - 5: For 85,000 85,000 - Incremental Costs - Depreciation on project Incremental Earnings before Taxes Incremental - Tax on Incremental EBT Tax Incremental Earnings after Taxes Incremental + Depreciation Reversal Depreciation Annual Cash Flow For Years 1 - 5: 85,000 85,000 (29,750) (29,750) - Depreciation on project Incremental Earnings before Taxes Incremental - Tax on Incremental EBT Tax Incremental Earnings after Taxes Incremental + Depreciation Reversal Depreciation Annual Cash Flow Annual For Years 1 - 5: 85,0...
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This note was uploaded on 01/17/2014 for the course GEB 3375 taught by Professor Sweo during the Winter '08 term at University of Central Florida.

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