The incremental annual cash flow associated with the project is $12400
<h3>What is incremental annual?</h3>
Sales resulting from a higher volume of sales are known as incremental revenue. Establishing a baseline revenue level and comparing changes from that point onwards is required to calculate incremental revenue.
<h3>According to the given information :</h3>
Depreciation=[($63,000/7 years)-($75,000/5 years)
Depreciation=$9000-$15000
Depreciation=$6000
Now let calculate the Incremental annual cash flow
Incremental annual cash flow
={($16000-$6000) - [($16000-$6000)*34%]+$6000}
= {(10000)- [10000*34%]+6000}
= {(10000) - 3600+6000}
= {16000-3600}
= $12400
Incremental annual cash flow=$12400
Therefore the incremental annual cash flow associated with the project is $12400
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