ABC, Inc is planning the purchase of a new equipment which will cost $26,526. The project is expected to last for 7 years. The equipment will have a…
ABC, Inc is planning the purchase of a new equipment which will cost $26,526. The project is expected to last for 7 years. The equipment will have a book value of $3,629 at the end of Year 7. The increase in net working capital is expected to be $3,061, all of which will be recouped at the end of the project. The project is expected to have annual operating cash flows of $10,291. What is the Total Cash Flow in Year 7 of the project if the equipment can be sold for $6,185 and the tax rate is 37%?
Note: In the last year of the project, the Total Cash Flow = Operating Cash Flow + Terminal Cash Flow
Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box.
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