3. Assume a firm has earnings before depreciation and taxes of $200,000 and no depreciation. It is...

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3. Assume a firm has earnings before depreciation and taxes of $200,000 and no depreciation. It is in a 40 percent tax bracket.

a. Compute its cash flow.

b. Assume it has $200,000 in depreciation. Recompute its cash flow.

c. How large a cash flow benefit did the depreciation provide?

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Foundations Of Financial Management

ISBN: 9780073382388

13th Edition

Authors: Stanley B. Block, Geoffrey A. Hirt, Bartley R. Danielsen

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Question Posted: Oct 22, 2024 06:00 AM

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Foundations Of Financial Management

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