5. Operating cash flow (S6.1) A company is considering the purchase of a universal grinding machine. The
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5. Operating cash flow (S6.1) A company is considering the purchase of a universal grinding machine. The following table sets out a forecast of the annual accounting profit:
Revenues $ 400,000 Costsa 280,000 Pretax profit 120,000 Tax at 25% 30,000 After-tax profit $ 90,000 a Note: costs include depreciation of $80,000.
Calculate the operating cash flow using the three methods set out in Eqs. (6.3A), (6.3B), and
(6.3C).
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Related Book For
Principles Of Corporate Finance
ISBN: 9781264080946
14th Edition
Authors: Richard Brealey, Stewart Myers, Franklin Allen, Alex Edmans
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