Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): Year 1 Year 2
Revenues 565 626
Operation expenses (other than depreciation) 400 475
Depreciation 50 60
Increase in non-cash working capital 25 -5
Capital expenditures 40 50
Marginal corporate tax rate 35% 35%

Required:
a. What are the incremental earnings for this project for years 1 and 2? 
b. The incremental earnings for year 2 is $million.
c. What are the free cash flows for this project for the first two years?