Barbera Corporation has provided the following information concerning a capital budgeting project: After-tax discount rate 9%Tax rate 30%Expected life of the project 4 Investment required in equipment$200,000 Salvage value of equipment$0 Working capital requirement$20,000 Annual sales$540,000 Annual cash operating expenses$380,000 One-time renovation expense in year 3$80,000 The company uses straight-line depreciation on all equipment.The total cash flow net of income taxes in year 3 is:
A. $77,000
B. $80,000
C. $71,000
D. $104,000
Answer: C
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