A Proposed Expansion Project Is Expected to Increase Sales of JL

question 89

Multiple Choice

A proposed expansion project is expected to increase sales of JL Ticker's Store by $35,000 and increase cash expenses by $21,000. The project will cost $24,000 and be depreciated using straight-line depreciation to a zero book value over the 4-year life of the project. The store has a marginal tax rate of 30 percent. What is the operating cash flow of the project using the tax shield approach?

• A)$5,600
• B)$7,800
• C)$11,600
• D)$13,300
• E)$14,600

---

Definitions:

Culture

The shared beliefs, practices, norms, values, and artifacts that characterize a group of people or society.

Traditions

Customs or beliefs passed down within a group or society with symbolic meaning or special significance.

Culture

The sum of attitudes, customs, and beliefs that distinguishes one group of people from another.

Values

Core beliefs or standards that guide and dictate behavior and actions in various situations.