Cash Flow
Assume a corporation has earnings before amortization and taxes (EBAT) of $110,000 and amortization of $48,000, and it has a 30 percent tax rate.
Compute its cash flow. (Input all answers as positive values.)
| Earnings before amortization and taxes | $ | |
| Amortization | ||
| Earnings before taxes | $ | |
| Taxes @ 30% | ||
| Earnings after taxes | $ | |
| Amortization | ||
| Cash flow | $ | |
Homework Answers
a
b
| Earning After-tax 110000*(1-.30) | 77000 |
| Add Tax saving in Depreciation 16000*30% | 4800 |
| Cash Flow | 81800 |
c
91400-81800=$9600
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