Go Fly A Kite is considering making and selling custom kites…

Go Fly A Kite is considering making and selling custom kites in two sizes. The small kites would be priced at $10.70 and the large kites would be $23.70. The variable cost per unit is $5.15 and $11.30, respectively. Jill, the owner, feels that she can sell 2,700 of the small kites and 1,730 of the large kites each year. The fixed costs would be $2,120 a year and the depreciation expense is $1,000. The tax rate is 21 percent. What is the annual operating cash flow?

Seeing Red has a new project that will require fixed assets…

Seeing Red has a new project that will require fixed assets of $905,000, which will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company has a tax rate of 21 percent. What is the depreciation tax shield for Year 3?