Answered: What is the operating cash flow for a…

What is the operating cash flow for a firm with $500,000 profit before tax, $100,000 depreciation expense, and a 21% tax rate? Select one: a.$260,000 b.$325,000 c.$360,000 d.$495,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Assume a company has 10 million of total assets: the market value of equity is 8 million and market…

A: The Weighted Average Cost of Capital(WACC) refers to the financial ratio that provides the overall…

Q: How much is the free cash flow of a firm with revenues of $8 million, operating margin of 32.5%, net…

A: Free cashflow (FCF) is an available cash to the firm after considering all operating expenses and…

Q: Data for Nationall Co. is as follows: Product A 2020 Product B 2020 10,000 P15 P13 2021 2021 Units…

A: The free cash flow refers to the cash that will be freely available to the owners of the entity…

Q: I need step by step solution

A: We have given data, Sales = $502,000Depreciation expense = $47,000Profit margin = 5%Tax rate = 35%…

Q: For the XYZ corporation in 2021: Long Term Operating Capital Net Working Capital Long Term Debt…

A: Free cash flow refers to the amount of money that the company has remains after incurring all the…

Q: Compute the value of a firm with free cash flows of $4000, $5000, and $6000 over the next three…

A: Present value factor is computed as follows:-PVF = wherePVF = Present value factorr= cost of capital…

Q: Edmonds Industries is forecasting the following income statement: Sales Operating costs excluding…

A: Variable costs are costs which change along with change in activity level. The variable cost usually…

Q: Local Co has sales of $10.4 million and cost of sales of $6.2 million. Its selling, general and…

A: Gross profit is the amount that shows the earnings of the company after allowing certain direct…

Q: If the after-tax rate of return for a cash flow series is 11.2% and the corporate effective tax rate…

A: The after-tax rate of return is the rate a project generates after taking the effect of the tax. It…

Q: Please answer all. From a company we get the following: Capital employed 20,000,000 dollar Debt /…

A: "Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: A firm has sales of $50,000, EBIT of $10,000, depreciation of $4,000, and fixed assets increased by…

A: To calculate the firm's free cash flow, we need to use the formula:Free Cash Flow…

Q: You are considering an investment in Fields and Struthers, Inc., and want to evaluate the firm's…

A: Operating cash flows (OCF) is the cash flows generated from normal operations- Selling and producing…

Q: A firm is anticipated to generate an EBIT of $2 million, with depreciation of $200,000, change in…

A: Given information: EBIT : $2 million Depreciation : $200,000 Change in Net working capital :…

Q: Suppose C Manufacturings sales increase 20% over the next year. Assuming all asset accounts change…

A: The question can be solved by first determining the forecasted Income statement. This can be done…

Q: The free cash flow to the firm is reported as $305 million. The interest expense to the firm is $76…

A: Free Cash Flow to the Firm (FCFF) is the cash flow available to both equity holders and the debt…

Q: If cash flow from operating activities is 700,000, tax rate is 30%, and capital expenditure is…

A: Free cash flow is $410,000. Computation of free cash flow: Excel spread sheet:

Q: Compute the operational cash-flow for a corporation with a return on equity of 25% and a…

A: Return on equity = Net incomeShareholders' equity Debt to equity ratio = Total debtShareholders'…

Q: 10. Sunny Corp. had a net income during 2018 of $165m, and after payir out dividends to…

A: Since you have asked multiple questions, we will answer the first question for you. Please post…

Q: Need Help with this Question solution provide

A: Given, The free cash flow for the next year, FCF1 = $ 150,000.The weighted average cost of capital,…

Q: Your firm has total sales of $1,320. Costs are $730 and depreciation is $110. The tax rate is 22…

A: Total sales = $1,320Costs = $730Depreciation expense = $110Tax rate = 22%Required:Operating cash…

Q: 3. Assume a firm has earnings before depreciation and taxes of $500,000 and no depreciation. It is…

A: Earning before depreciation and taxes $500,000 Depreciation…

Q: Find the present value of the following stream of a firm's cash flows, assuming that the firm's…

A: The objective of this question is to calculate the present value of a series of future cash flows.…

Q: Please solution

A: As per the data shared by Dog House:Sales = $502,000Depreciation expense = $47,000Profit margin =…

Q: If a company is expected to generate annual cash flow of $500,000 and has a WACC of 12.5%, then the…

A: The valuation of a company is calculated with help of the revenue before subtracting operating…

Q: Celeron, Inc. expects net cash flow from operating activities to be $150,000, and the company plans…

A: Free cash Flow is a measure of a company`s financial performance and represents the cash in hand,…

Q: FinCorp's free cash flow to the firm (FCFF) is reported as $200 million. The firm's interest expense…

A: FCFE is free cash flow for equity refers to the cash flow available for the equity holders or…

Q: Assuming a firm's weighted average cost of capital is 11%, what is the net present value (NPV) of…

A: NPV means Net present value.It is calculated by deducting initial investment from present value of…

Q: Want the Correct answer

Q: If your firm has an Operating Cash flow of $180,000 with a -$75,000 change in Net Working Capital,…

A: The cash flow from assets refers to the cash flow that the company receives or pays to its…

Q: Given an asset with a net book value (NBV) of $35,000. a. What are the after-tax proceeds for a firm…

A: Gain or Loss on sale of assets is the difference between sales value of assets and net book value of…

Q: Last year, Industrial Industries had Operating Cash Flow of 125,000. It had Net Capital Spending of…

A: Free Cash Flow: It represents the cash stays after meeting company's operational cost and…

Q: Suppose a company’s most recent free cash flow (i.e., FCF0) was $100 million and is expected to grow…

A: FCF0 = $100 million Growth rate (g) = 5% WACC (r) = 15%

Q: Based on the given information, how much is the weighted average cost of capital?

A: Market value of ordinary shares = P 5 million Market value of long term debt = P 6.25 million Total…

Question

What is the operating cash flow for a firm with $500,000 profit before tax, $100,000 depreciation expense, and a 21% tax rate?

Select one:

a.$260,000

b.$325,000

c.$360,000

d.$495,000

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Use the information below to calculate WACC given the Market Capitalization of the company: Market Cap = 193.2 Million EBIT = 17.2 Million Depreciation = 4.2 Million Capital Expenditures = - 3.8 Million Change in W/C = 2.1 Million growth = 7% FCF = ? WACC = ?
Estimate a firm's economic value added (EVA) based on the following information: NOPAT = $400,000; amount of financial capital used = $1,600,000; and WACC = 19%. $26,000 $36,000 $96,000 54,000
Find the present value of the following stream of a firm's cash flows, assuming that the firm's opportunity cost is 8%. End of year Cash flow 1 2 3 $5,000 $25,000 $14,000
We are predicting for the end of this fiscal year: Skunk Products' EBIT is $1000, its tax rate is 35%, depreciation is $100, capital expenditures are $200, accounts receivable increase by $100, and accounts payable decrease by $100. What is the free cash flow to the firm? The FCFF will grow at 3%, WACC is 10%. What is the value of the company's assets? FCFF1 = $
Omega Corp. has EBIT of $12 million, depreciation expense of $2 million and taxes of $4 million. Omega's operating cash flow (OCF) is: Group of answer choices $6 million $10 million $14 million $18 million
Assume the following: • A company is importing and selling Mercedes cars. • An Islamic bank invests US$8 million for an 80% profit share. • An investor invests US$2 million for a 20% profit share. • The investor is to be paid a 10% management fee as percentage of profit after expenses. • Sale proceeds = US$12,400,000 Expenses = US$200,000 Calculate the following: 1.1. The total return to the bank: 1.2. The total return to the investor:
Edmonds Industries is forecasting the following income statement: Sales Operating costs excluding depreciation & amortization EBITDA Depreciation and amortization EBIT Interest $6,000,000 3,300,000 $2,700,000 300,000 $2,400,000 480,000 EBT $1,920,000 Taxes (25%) 480,000 $1,440,000 Net Income The CEO would like to see higher sales and a forecasted net income of $2,720,000. Assume that operating costs (excluding depreciation and amortization) are 55% of sales and that depreciation and amortization and interest expenses will increase by 6%. The tax rate, which is 25%, will remain the same. (Note that while the tax rate remains constant, the taxes paid will change.) What level of sales would generate $2,720,000 in net income? Round your answer to the nearest dollar, if necessary. $
Vijay
A firm has sales of $10,000, EBIT of $3,000, depreciation of $400, and fixed assets increased by $2,000. If the firm's tax rate is 30 percent and there were no increases in net operating working capital, what is the firm's free cash flow? Multiple Choice O O $500 $600 $7400 -$1,220
A firm has EBIT of $300,000 and depreciation expense of $12,000. Fixed charges total $44,000. Interest expense totals $7,000. What is the firm's cash coverage ratio? Multiple Choice 3.76 times 4.91 times 7.25 times 7.09 times
Suppose Alcatel-Lucent has an equity cost of capital of 10%, market capitalization of $10.8 billion, and an enterprise value of $14.4 billion. Suppose Alcatel-Lucent’s debt cost of capital is 6.1% and its marginal tax rate is 35%. The cash flow for the project is as follows, same as was given in the previous question. Year 0 1 2 3 FCF -100 50 100 Calculate FCFE for each year but only answer: What is the Percentage change in FCFE in Year 2 from Year 1? Please give your answer in Percentage up to 2 places of Decimal without giving the % sign.
Use the following information to answer this question. Total assets Total current liabilities Total expenses Total liabilities Total revenues Tax rate $150,000 105,000 70,000 110,000 80,000 40% After -tax cost of capital 12% Invested capital is defined as total assets less total liabilities. (round your answers te one decimal ) Capital turnover equal O A) 53.3% B) 2 OC) 6.7% D) 28.6%