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Waltham Company is considering a 3-year project with an initial cost of $622,000. The project will...

Waltham Company is considering a 3-year project with an initial cost of $622,000. The project will not directly

produce any sales but will reduce operating costs by $153,000 a year. The equipment is classified as

MACRS 7-year property. The MACRS table values are .1429, .2449, .1749, .1249, .0893, .0892, .0893, and

.0446 for Years 1 to 8, respectively. At the end of the project, the equipment will be sold for an estimated

$295,000. The tax rate is 25 percent and the required return is 12 percent. An extra $45,600 of inventory will

be required for the life of the project. What is the total cash flow for Year 3?

A. $481,233.55 B. $476,797.10 C. $470,833.54 D. $464,299.66 E. $457,340.20

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