When Calculating Cash Flow from Operations,one Should

question 27

Multiple Choice

When calculating cash flow from operations,one should:

• A) subtract depreciation since it represents the cost of replacing worn-out equipment.
• B) deduct the depreciation tax shield from after-tax profit.
• C) use after-tax profit and ignore depreciation.
• D) add depreciation to after-tax profit.

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Definitions:

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A mathematical expression that calculates the probability of obtaining a fixed number of successes in a fixed number of independent trials, given the success probability for one trial.

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The arrangement of all the members of a set into some sequence or order, or if the set is already ordered, rearranging its elements, a process called permuting.

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