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Penelope Medina
on Dec 09, 2024

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The operating cash flow of a firm is equal to net income plus depreciation provided that:

A) Taxes are ignored.
B) The financing costs are ignored.
C) The project is a cost cutting project.
D) The costs are expressed as equivalent annual costs.
E) Net income is positive.

Operating Cash Flow

A metric reflecting the cash flow from a company's core operations.

Net Income

Net income is the total earnings of a company after all expenses and taxes have been subtracted from revenues, representing the profit during a specific period.

Depreciation

Allocation of the cost of an asset over its useful life, recognizing the reduction in value due to wear and use.

  • Understand the concept of operating cash flow and its calculation.
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AlienYou KokyeowDec 13, 2024
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