Which One of the Following Formulas Is Incorrect

question 75

Multiple Choice

Which one of the following formulas is incorrect?

• A) Operating cash flow = revenues − cash expenses − taxes
• B) Operating cash flow = net profit + depreciation
• C) Depreciation tax shield = depreciation × (1 − tax rate)
• D) Operating cash flow = (revenues − cash expenses) × (1 − tax rate) + (depreciation × tax rate)

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Definitions:

Inputs Employed

The resources, including labor, capital, and materials, used in the production of goods and services.

Additional Revenues

Income received that is above and beyond the standard or expected revenue streams.

Hiring Employee

The process of finding, selecting, and appointing suitable candidates for jobs within an organization.

Signing Bonus

A one-time payment offered by employers to incentivize a candidate to accept a job offer.