Before-Tax Cash Flow

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• Annual Before Tax Cash Flow

  Before tax cash flows X (1-tax rate) = after tax cash flow Before tax cash flow = 1,992.43/(1-0.4) = $3,320.71 The after tax cash flow is 1,992,43 The before tax cash flow is 3,320.71 The annual before tax cash flows are determined.

• Jim Bo's currently has annual cash revenues of $240,000 and annual operating expenses of $185,000 including $35,000 in depreciation. The firm's marginal tax rate is 40 percent. A new cutting machine can be purchased for $120,000 that will increase revenues by $50,000 per year while operating expenses would increase to $205,000, including $42,000 in depreciation. Compute Jim Bo's annual incremental after-tax net cash flows.

  . $19,000 Before cash Flow calculation Revenue = 240,000 Operating expenses = 185,000 Profit before tax = 55,000 (revenue - expenses) Tax @40% = 22,000 Profit After Tax = 33000 Depreciation = 35000 Net cash flow = 68000 (Profit after tax

• Details regarding cash flows

  Cash flow= 240,000+360,000=$600,000 Evans Corporation Gross Profit = 880,000 Depreciation Expense 60,000 SGA expense 120,000 Income before tax = 700,000 Tax (40%) = 280,000 Net Income = 420,000 Cash flow= 420,000+60,000=$480,000 The difference

• Managerial Acct

  flow before tax $9,000 Less: Tax @ 34% $3,060 Net cash flow after tax $5,940 Add : Depreciation $6,000 Net Cash flow $11,940 This solution consist of Managerial Accounting.

• Operating Cash Flow - Eisenhower Communications

  The after tax loss of cash flow due to cannibalization should be subtracted from the operating cash flow. At a tax rate of 40%, the after tax cash flow is 600,000. The operating cash flow would be $2,000,000 c.

• Fair Weather Friend Corporation

  Fair Weather Friend Corporation has earnings before depreciation and taxes of $90,000; and depreciation of $40,000 and that it has a 30 percent tax bracket. a. Compute its cash flow using the format below.

• Computation of Cash Flow of Corporate Earnings

  216485 Computation of Cash Flow of Corporate Earnings Assume a corporation has earnings before depreciation and taxes of $90,000, depreciation of $40,000, and that it is in a 30 percent tax bracket. Compute its cash flow using the format below.

• Net Income and Cash Flow

  in $mn Sales 20000000 Less costs 14000000 Profit before depreciation 6000000 Less depreciation 1500000 Profit before taxes 4500000 Less taxes 1800000 Net Income 2700000 Add Depreciation 1500000 Net cash flows 4200000 Net Income and Cash Flow

• Opportunity Yawl NPV

  Opportunity 1 will generate $40,000 before-tax cash flow in years 0, 1 and 2, with a $7,000 annual tax cost. Opportunity 2 will also generate $40,000 before-tax cash flow in years 0, 1 and 2.