To Estimate the Cash Flow from Operations, Depreciation Must Be

question 34

True/False

To estimate the cash flow from operations, depreciation must be added back to net income because it is a non-cash charge that has been deducted from revenue.

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Definitions:

Business Judgment Rule

A legal principle that protects corporate directors and officers from liability for decisions made in good faith and in the best interests of the corporation.

Fiduciary Duty

A legal obligation of one party to act in the best interest of another when entrusted with care of their assets or interests.

Eisner

Likely refers to a notable figure or context-specific reference requiring further details for accurate definition. If related to a person, it may refer to Michael Eisner, a prominent business executive in the entertainment industry.

Audit Committee

A subgroup of a board of directors that focuses on oversight of the financial reporting processes, internal controls, and audit functions of an organization.