Question

Tubby Toys estimates that its new line of rubber ducks will generate sales of $7.40 million,...

Tubby Toys estimates that its new line of rubber ducks will generate sales of $7.40 million, operating costs of $4.40 million, and a depreciation expense of $1.40 million. If the tax rate is 40%, what is the firm’s operating cash flow?

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Laurel’s Lawn Care, Ltd., has a new mower line that can generate revenues of $177,000 per...
Laurel’s Lawn Care, Ltd., has a new mower line that can generate revenues of $177,000 per year. Direct production costs are $59,000, and the fixed costs of maintaining the lawn mower factory are $24,500 a year. The factory originally cost $1.18 million and is being depreciated for tax purposes over 20 years using straight-line depreciation. Calculate the operating cash flows of the project if the firm’s tax bracket is 40%.
12-2     a. If Company XYZ plans to launch a new production line, and in year 1,...
12-2     a. If Company XYZ plans to launch a new production line, and in year 1, will have sales revenue $10,000,000, operating cost is 70% of the sales revenue, depreciation is $2,000,000, and tax rate is 40%, what is the Company’s projected cash flow in year 1? b. If the Company’s launch of the new production line will cause the exit of an existing production line that can generate $1,000,000 operating income before tax, how much will be the Company’s...
Bennett Co. has a potential new project that is expected to generate annual revenues of $263,900,...
Bennett Co. has a potential new project that is expected to generate annual revenues of $263,900, with variable costs of $144,800, and fixed costs of $61,900. To finance the new project, the company will need to issue new debt that will have an annual interest expense of $25,500. The annual depreciation is $25,600 and the tax rate is 40 percent. What is the annual operating cash flow?
Laurel’s Lawn Care Ltd., has a new mower line that can generate revenues of $126,000 per...
Laurel’s Lawn Care Ltd., has a new mower line that can generate revenues of $126,000 per year. Direct production costs are $42,000, and the fixed costs of maintaining the lawn mower factory are $16,000 a year. The factory originally cost $1.05 million and is being depreciated for tax purposes over 25 years using straight-line depreciation. Calculate the operating cash flows of the project if the firm’s tax bracket is 25%. (Enter your answer in dollars not in millions.)
Bennett Co. has a potential new project that is expected to generate annual revenues of $255,800,...
Bennett Co. has a potential new project that is expected to generate annual revenues of $255,800, with variable costs of $141,200, and fixed costs of $59,200. To finance the new project, the company will need to issue new debt that will have an annual interest expense of $21,000. The annual depreciation is $23,800 and the tax rate is 40 percent. What is the annual operating cash flow? $173,816 $124,120 $79,200 $42,760 $43,920
Operating cash flow. Grady Precision Measurement Tools has forecasted the following sales and costs for a...
Operating cash flow. Grady Precision Measurement Tools has forecasted the following sales and costs for a new GPS​ system: annual sales of 40,000 units at ​$26 a​ unit, production costs at 35​% of sales​ price, annual fixed costs for production at ​$130,000​, and​ straight-line depreciation expense of ​$215,000 per year. The company tax rate is 40​%. What is the annual operating cash flow of the new GPS​ system?
Alcan invested $71 million in a new packaging facility in North Carolina. If the plant is...
Alcan invested $71 million in a new packaging facility in North Carolina. If the plant is to be depreciated over 10 years with straight line depreciation, sales are to generate $49 million in revenues per year, operating and maintenance costs are $24 million per year, and there is no salvage value, what is the after-tax cash flow (in millions of $) from the year 9 of production for the facility? Assume an effective tax rate of 36%. When entered your...
Quad Enterprises is considering a new 3yr expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new 3yr expansion project that requires an initial fixed asset investment of $2.4 million. The fixed asset will be depreciated straight-line to zero over its 3yr life after which it will be worthless. The project is estimated to generate $2,550,000 in annual sales, with operating costs of $1,180,000, not including depreciation cost. If the tax rate is 35%, what is the annual operating cash flow for this project?
Pio’s Rubber and Plastics, Inc. currently has annual cash revenues of $310,000 and annual operating expenses...
Pio’s Rubber and Plastics, Inc. currently has annual cash revenues of $310,000 and annual operating expenses of $105,000 to include $45,000 in depreciation. The firm’s marginal tax rate is 40 percent. A new extruder can be purchased for $130,000 that will increase revenues by $85,000 per year while operating expenses would increase by $18,000. The investment will increase depreciation by $6,000. Compute Pio’s annual incremental after-tax net cash Pio’s Rubber and Plastics, Inc. currently has annual cash revenues of $310,000...
A proposed new investment has projected sales of $950,000. Variable costs represent 60% of sales, and...
A proposed new investment has projected sales of $950,000. Variable costs represent 60% of sales, and fixed costs are $210,000; depreciation is $102,000. What is the projected operating cash flow assuming a tax rate of 35%.                                          Sales                                                        $687,500                                     Operating Costs                                         343,860                                     Depreciation                                              110,000 What is Net Operating Profit, Taxes at 35%, Net Profit, and Operating Cash Flow