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Assume a corporation has earnings before depreciation and taxes of $105,000, depreciation of $43,000 and that...

Assume a corporation has earnings before depreciation and taxes of $105,000, depreciation of $43,000 and that it is in a 35 percent tax bracket. Compute its cash flow using the following format.

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Answer #1

Cash Flow = (1 - 0.35)(105,000 - 43,000) + 43,000

Cash Flow = $83,300

So,

Cash Flow = $83,300

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