A Manager Is Considering a Special Project

question 60

Essay

A manager is considering a special project.Corporate policy dictates that all special projects must generate an after-tax profit of $21 000.If the company expects costs related to the project to be equal to $43 000,what is the before-tax cash sales price that should be charged in order to adhere to corporate policy assuming the company has a tax rate of 30 per cent?

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Definitions:

Operating Cash Receipts

Cash received by a company from its core business operations.

Cash Flow

Indicates the total amount of money being transferred into and out of a business, particularly affecting its liquidity.

Total Assets

The sum of all assets owned by a company, including cash, inventory, property, and equipment.

Operating Cash

Cash generated from a company's normal business operations.