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Net Income and net cash flow

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3-6 Cash Flow
The Klaven Corporation has an operating income (EBIT) or $750,000. The company's depreciation expenses is $200,000. Klaven is 100 percent equity financed and it faces a 40 percent tax rate. What is the company's net income? What is its net cash flow?

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Solution Summary

The solution explains how to calculate the net income and the net cash flow in the given accounting problem.

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EBIT (Earnings before interest and tax) = 750,000
Interest = 0 (since the ...

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