"When evaluating projects in a firm financed with a mix of equity and debt, we're concerned with only the relevant aftertax cash flows. Therefore, because depreciation is a non-cash expense, we should ignore its effects when evaluating projects." Critically evaluate this statement. Depreciation is ignored and regardless of the tax rate it is not included in the project analysis Depreciation does not affect Operating Cash Flow (OCF), as we do not include Interest Expenses in our OCF calculation We account for depreciation in full when evaluating projects, as depreciation decreases our Net Working Capital (NWC) requirements We should only include depreciation in our project analysis if the equipment being depreciated was purchased with debt instead of equity Depreciation is a non-cash expense but it provides a tax shield, therefore we should only consider the tax saving associated with depreciation when analyzing cash flows from projects