Taylor Inc., the company you work for, is considering a new project whose data are shown below. What is the project's Year 1 cash flow?
A) $25,816
B) $27,175
C) $28,534
D) $29,960
E) $31,458

Question

Taylor Inc., the company you work for, is considering a new project whose data are shown below. What is the project's Year 1 cash flow? 
A) $25,816 
B) $27,175 
C) $28,534 
D) $29,960 
E) $31,458

Quizplus · Accepted Answer

The Year 1 cash flow is calculated by adding up all the cash inflows and subtracting all the cash outflows for Year 1. In this case, the cash inflows are $115,000 and the cash outflows are $87,825, so the Year 1 cash flow is $27,175 (115,000 - 87,825).