Which three changes would affect an estimate of differential cash flows?

The selection of an increase in the estimated value of the new machine, a revision in the depreciation schedule, and an increase in the overhead allocation as changes that would affect an estimate of differential cash flows is accurate because each item directly influences the net cash flows associated with a project or investment decision.

An increase in the estimated value of the new machine signifies that the initial cost or the potential revenue it can generate has been reassessed, which alters the expected cash inflows or outflows related to that asset. This could lead to a different analysis of whether the investment is advantageous compared to other options.

A revision in the depreciation schedule impacts how the costs associated with the machine are allocated over time. Changes to the depreciation method can lead to different accounting treatments and affect taxable income, thus modifying cash flows. These revisions can influence the timing and amount of cash flows due to tax implications.

Increasing overhead allocation suggests that the fixed or indirect costs associated with the operating of the facility are projected to rise, which would directly affect the total operating cash flow of the project. Such changes in cost estimates need to be considered when evaluating the financial viability and overall profitability of a project, impacting the differential cash flows that decision-makers assess.

Together, these factors directly contribute to calculating the incremental