Your company has decided to produce a new line of television/electronic media player. You estimate that revenue from sales of this new product will equal $38,250,000. The plant and equipment (new fixed assets) needed to manufacture this product costs $22,400,000 and will be depreciated on a straight-line basis over the seven year project. Additional manufacturing costs to produce the media players would total $16,980,000 each year. The tax rate is 40%. Sketch (explain with a table or in words) a simplified income statement and calculate the firm’s operating cash flow.
Walk me through this problem step by step or write the formula with the numbers filled in.