Calculate Cash Flows Determine the net cash flows for the first year of the proj
ID: 2484679 • Letter: C
Question
Calculate Cash Flows
Determine the net cash flows for the first year of the project, Years 2–9, and for the last year of the project. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar.
Cornucopia Inc.
Net Cash Flows
Year 1
Years 2-9
Last Year
Initial investment
$
Operating cash flows:
Annual revenues
$
$
$
Selling expenses
Cost to manufacture
Net operating cash flows
$
$
$
Total for Year 1
$
Total for Years 2-9
$
Residual value
Total for last year
$
HideHint(s)
Determine the net cash flows for the first year of the project, Years 2–9, and for the last year of the project. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar.
Cornucopia Inc.
Net Cash Flows
Year 1
Years 2-9
Last Year
Initial investment
$
Operating cash flows:
Annual revenues
$
$
$
Selling expenses
Cost to manufacture
Net operating cash flows
$
$
$
Total for Year 1
$
Total for Years 2-9
$
Residual value
Total for last year
$
Explanation / Answer
Year 1 Years 2-9 Last Year Initial investment [A] 107,000 - - Operating cash flows: Annual revenues 272,000 [4000 units * $68] 272,000 [4000 units * $68] 272,000 [4000 units * $68] Selling expenses (13,600) [272000*5% (13,600) [272000*5% (13,600) [272000*5% Cost to manufacture (208,000) [4000 units * $52] (208,000) [4000 units * $52] (208,000) [4000 units * $52] Net operating cash flows [B] 50,400 50,400 50,400 Residual value [C] - - 13,000 Total for Year [B+C-A] (56,600) 50,400 63,400 Total for Years 2-9 403,200 [$50400* 8 yrs]
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