The Tax-Shield Approach for Calculating Project Operating Cash flOw Does

question 42

True/False

The tax-shield approach for calculating project operating cash flow does not require you to add
back noncash deductions such as depreciation.

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Definitions:

Day-to-Day Operations

The routine activities required for the running of a business on a regular, daily basis, involving processes, resources, and staff management.

Indirect Method

A method used in the preparation of cash flow statements which adjusts net income for transactions that affect reported net income but did not involve cash.

Accounts Receivable

Money owed to a business by its customers for goods or services that have been delivered or used but not yet paid for.

Accounts Payable

Liabilities or money owed to suppliers or creditors for goods and services received but not yet paid for.