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Assume that Congress recently passed a provision that will enable Bev's Beverages Inc. ( BBI ) to double its depreciation expense for the upcoming year
Assume that Congress recently passed a provision that will enable Bev's Beverages Inc. BBI to double its depreciation expense for the upcoming year but will have no effect on its sales revenue or the tax rate. Prior to the new provision, BBI's net income was forecasted to be $ million. Which of the following best describes the impact of the new provision on BBI's financial statements versus the statements without the provision?
The provision will increase the firm's operating income EBIT
The provision will increase the company's net income.
The provision will increase the company's cash flow.
The provision will increase the company's tax payments.
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