Hubrey home inc is considering a new three-year expansion


Hubrey Home Inc. is considering a new three-year expansion project that requires an initial fixed asset investment of $4.5 million. The fixed asset falls into Class 10 for tax purposes (CCA rate of 30 percent per year), and at the end of the three years can be sold for a salvage value equal to its UCC. The project is estimated to generate $2,710,000 in annual sales, with costs of $858,000. If the tax rate is 35 percent, what is the OCF for this project.

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Risk Management: Hubrey home inc is considering a new three-year expansion
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