The Outpost, a Sole Proprietorship Currently Sells Short Leather Jackets

question 10

Multiple Choice

The Outpost, a sole proprietorship currently sells short leather jackets for $369 each.The firm is considering selling long coats also.The long coats would sell for $719 each and the company expects to sell 820 a year.If the company decides to carry the long coat, management feels that the annual sales of the short jacket will decline from 1,120 to 1,040 units.Variable costs on the jacket are $228 and $435 on the long coat.The fixed costs for this project are $23,100, depreciation is $10,400 a year, and the tax rate is 34 percent.What is the projected operating cash flow for this project?

• A)$134,546
• B)$131,264
• C)$112,212
• D)$131,062
• E)$128,749

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