Which of the Following Describes the "Bottom-Up" Approach to Defining

question 213

Multiple Choice

Which of the following describes the "bottom-up" approach to defining operating cash flow?

• A) EBIT + D - Taxes
• B) NI + D
• C) (S - C) (1 - TC) + DTc
• D) S - C - Taxes
• E) NI + D - taxes

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Definitions:

Accrued Interest

The accumulation of interest on a loan or bond since the last payment date but not yet paid out to the lender.

Gain on Sale of Investments

The profit realized from selling investments for more than the purchase price.

Investments-Evans Company Bonds

Specific long-term investments made in the bonds issued by Evans Company.

Treasury Bonds

Long-term government securities issued with a fixed interest rate and maturity of generally more than 10 years.