Explore BrainMass

Explore BrainMass

    Benefits of depreciation, cash budgeting, and cash flow

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    What is the benefit of depreciation?
    What are some of the issues for a financial manager in reviewing pro forma financial statements?
    Is cash budgeting necessary? Why or why not?
    Simplify the differences between cash flow, operating cash flow and free cash flow.

    © BrainMass Inc. brainmass.com June 4, 2020, 1:35 am ad1c9bdddf
    https://brainmass.com/business/cash-budgeting/benefits-depreciation-cash-budgeting-cash-flow-409078

    Solution Preview

    Benefits of depreciation:

    1. Depreciation can help the company reduce taxes in higher income years
    2. Depreciation is a non-cash charge which implies that the firm can make a depreciation deduction in the current year even if they did not spend money to buy the item in that year
    3. Depreciation impacts companies' financial statements such as balance sheet, profit and loss ...

    Solution Summary

    This solution answers the following series of questions:

    1. What is the benefit of depreciation?
    2. What are some of the issues for a financial manager in reviewing pro forma financial statements?
    3. Is cash budgeting necessary? Why or why not?
    4. Simplify the differences between cash flow, operating cash flow and free cash flow.

    $2.19

    ADVERTISEMENT