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Jefferson & Sons is evaluating a project that will increase annual sales by $150,000 and annual...

Jefferson & Sons is evaluating a project that will increase annual sales by $150,000 and annual cash costs by $90,000. The project will initially require $100,000 in fixed assets that will be depreciated straight-line to a

zero book value over the 5-year life of the project. The applicable tax rate is 40 percent. What is the operating cash flow for this project?

a.

$11,220

( )

b.

$29,920

( )

c.

$44,000

( )

d.

$46,480

( )

e.

$46,620
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