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, is considering a new 3-year expansion project that requires an initial fixed asset investment of $2205000.

hi i am having issues doing this because ebit is negative how do you do it


Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $2205000. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will be worthless. The project is estimated to generate $2203000 in annual sales, with costs of $1704000. If the tax rate is 0.20 , what is the OCF for this project?

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