Telstar Communications is going to purchase an asset for $800,000 that will produce $390,000 per year for the next four years in earnings before depreciation and taxes. The asset will be depreciated using the three-year MACRS depreciation schedule in Table 12-12. (This represents four years of depreciation based on the half-year convention.)

The firm is in a 36 percent tax bracket. Fill in the schedule below for the next four years.

(Input all amounts as positive values. Round your answers to the nearest whole dollar amount.)

                                                               Year 1         Year 2           Year 3       Year 4

Earnings before depreciation and taxes

Depreciation Earnings before taxes

Taxes Earnings after taxes

Depreciation Cash flow