The Wolf's Den is considering replacing the equipment it uses to produce tents.The equipment would cost $1.4 million and lower manufacturing costs by an estimated $215,000 a year.The equipment will be depreciated over 8 years using straight-line depreciation to a book value of zero.Ignore bonus depreciation.The required rate of return is 13 percent and the tax rate is 21 percent.The equipment will be worthless after 8 years.What is the annual operating cash flow from this proposed project?
A)$141,900
B)$206,600
C)$232,400
D)$160,000
E)$40,000

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The Answer of The Wolf's Den is considering replacing the equipment it uses to produce tents.The equipment would cost $1.4 million and lower manufacturing costs by an estimated $215,000 a year.The equipment will be depreciated over 8 years using straight-line depreciation to a book value of zero.Ignore bonus depreciation.The required rate of return is 13 percent and the tax rate is 21 percent.The equipment will be worthless after 8 years.What is the annual operating cash flow from this proposed project?
A)$141,900
B)$206,600
C)$232,400
D)$160,000
E)$40,000

The Wolf's Den Is Considering Replacing the Equipment It Uses