Jefferson & Sons Is Evaluating a Project That Will Increase

question 19

Multiple Choice

Jefferson & Sons is evaluating a project that will increase annual sales by $145,000 and annual cash costs by $94,000.The project will initially require $110,000 in fixed assets that will be depreciated straight-line to a zero book value over the 4-year life of the project.The applicable tax rate is 32 percent.What is the operating cash flow for this project?

• A)$11,220
• B)$29,920
• C)$43,480
• D)$46,480
• E)$46,620

---

Definitions:

Deal-Making Process

The series of steps involved in negotiating and finalizing agreements between parties, often in business contexts.

Legal Advice

Guidance given by a legal professional regarding the law or legal proceedings relevant to a client's specific situation.

Accounting Advice

Professional recommendations or guidance concerning the financial management, practices, and recording of a business or individual's affairs.

Rate of Return

A measure of the gain or loss on an investment over a specified period, expressed as a percentage of the investment's initial cost.