Question
In: Finance
The Moore Corporation had operating income (EBIT) of $800,000. The company's depreciation expense is $240,000. Moore...
The Moore Corporation had operating income (EBIT) of $800,000. The company's depreciation expense is $240,000. Moore is 100% equity financed, and it faces a 35% tax rate.
What is the company's net income?
$
Assuming no changes to any of the Balance Sheet accounts, what
is its net cash flow?
$
Solutions
Expert Solution
| EBIT | 800,000 |
| Less:tax@35%(800,000*35%) | 280,000 |
| Net income | $520,000 |
b.Net cash flow=Net income+Depreciation
=(520,000+240,000)=$760,000.
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