Use the Information for the Question(s)below

question 39

Multiple Choice

Use the information for the question(s) below.
Epiphany Industries is considering a new capital budgeting project that will last for three years. Epiphany plans on using a cost of capital of 12% to evaluate this project. Based on extensive research, it has prepared the following incremental cash flow projects:

-A firm is considering a new project that will generate cash revenue of $1 000 000 and cash expenses of $700 000 per year for five years. The equipment necessary for the project will cost $200 000 and will be depreciated using the straight-line method over four years. What is the expected free cash flow in the second year of the project if the firm's marginal tax rate is 30%?

• A)$225 000
• B)$245 000
• C)$195 000
• D)$162 500

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Intelligence Test Scores

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Gender Gap

The disparities between men and women in various aspects of life, including but not limited to social, political, intellectual, cultural, or economic attainments or attitudes.

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