Problem: You are analyzing a project and have developed the following estimates. The depreciation is $72,000 a year and the tax rate is 35 percent. What is the best case operating cash flow?
Base Case Lower Bound Upper Bound
Unit Sales 2700 2400 2900
Price Per Unit $210 $190 $220
Variable Cost per unit $140 $130 $160
Fixed Cost $27,000 $25,500 $28,500
1. 119775
2. 138275
3. 153075
4. 164775
5. 178275