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Cairn Communications is trying to estimate the first-year operating cash flows (at t = 1) for a proposed project. The financial staff has collected the following information:,Projected sales $10 million,Operating Costs (no depreciation) $ 7 million,Depreciation $ 2 million,Interest expense $ 2 million,The company faces a 40% tax rate. What is the project’s operating cash flows for the first year (t=1)?,,Allen Air Lines is now in the terminal year of a project. The equipment originally cost $20 million, of which 80% has been depreciated. Caster can sell the used equipment today to another airline for $5 million, and its tax rate is 40%. What is the equipment’s after-tax net salvage value? ,

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