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Essentials Of Investments
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ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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You are considering opening a new restaurant in the Texas Burgers chain. The new restaurant will have annual revenue of $309,000
and operating expenses of $154,500. The annual depreciation and amortization for the assets used in the restaurant will equal
$51,500. An annual capital expenditure of $9,500 will be required to offset wear and tear on the assets used in the restaurant, but no
additions to working capital will be required. The marginal tax rate will be 30 percent.
Calculate the incremental annual after-tax free cash flow for the project.
Incremental annual after-tax free cash flow $](https://content.bartleby.com/qna-images/question/caedf255-819e-4de4-8945-bb77a92dd064/9e165b12-d169-485d-b2d7-7957b16ae45c/0ovtm6n_thumbnail.jpeg)
Transcribed Image Text:Current Attempt in Progress
You are considering opening a new restaurant in the Texas Burgers chain. The new restaurant will have annual revenue of $309,000
and operating expenses of $154,500. The annual depreciation and amortization for the assets used in the restaurant will equal
$51,500. An annual capital expenditure of $9,500 will be required to offset wear and tear on the assets used in the restaurant, but no
additions to working capital will be required. The marginal tax rate will be 30 percent.
Calculate the incremental annual after-tax free cash flow for the project.
Incremental annual after-tax free cash flow $
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