Question

Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $15.00 million fully installed and will be fully depreciated over a 16.00 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.81 million per year and increased operating costs of $780,415.00 per year. Caspian Sea Drinks' marginal tax rate is 35.00%. The incremental cash flows for produced by the RGM-7000 are _____.

Round to 2 decimal places.

Answer 1

Incremental Cash Flows produced by RGM-7000 are $1,647,355.25