Fernhurst (Sep/Dec 16)Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Fernhurst (Sep/Dec 16)This topic has 1 reply, 2 voices, and was last updated 2 years ago by John Moffat.Viewing 2 posts - 1 through 2 (of 2 total)AuthorPosts November 25, 2021 at 5:08 pm #641621 ArtemMemberTopics: 16Replies: 10☆Dear sir,Could you please explain, why when calculating the sensitivity of sales of the project in (b) part of the question, we have to multiply each cash flow by 0.75.Thanks in advance,Artem November 26, 2021 at 5:52 am #641651 John MoffatKeymasterTopics: 57Replies: 54470☆☆☆☆☆It is because of the tax.If the revenue falls by $1 then the profit will fall by $1 and so the tax will be lower by $0.25. So the net change in the cash flow will be $0.75.AuthorPostsViewing 2 posts - 1 through 2 (of 2 total)You must be logged in to reply to this topic.Log In Username: Password: Keep me signed in Log In