Last year Shipman, Inc. had $109,000 in operating income. The company had depreciation expense of $37,000,...

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Last year Shipman, Inc. had $109,000 in operating income. The company had depreciation expense of $37,000, interest expense of $23,400, and a corporate tax rate of 40 percent. The company has $378,000 in current assets and $90,000 in non-interest-bearing current liabilities; it has $266,000 in net plant and equipment. It estimates that it has an after-tax cost of capital of 12 percent. Assume that its only noncash item was depreciation. What was the company's net cash flow for the year? Last year Shipman, Inc. had $109,000 in operating income. The company had depreciation expense of $37,000, interest expense of $23,400, and a corporate tax rate of 40 percent. The company has $378,000 in current assets and $90,000 in non-interest-bearing current liabilities; it has $266,000 in net plant and equipment. It estimates that it has an after-tax cost of capital of 12 percent. Assume that its only noncash item was depreciation. What was the company's net cash flow for the year? Last year Shipman, Inc. had $109,000 in operating income. The company had depreciation expense of $37,000, interest expense of $23,400, and a corporate tax rate of 40 percent. The company has $378,000 in current assets and $90,000 in non-interest-bearing current liabilities; it has $266,000 in net plant and equipment. It estimates that it has an after-tax cost of capital of 12 percent. Assume that its only noncash item was depreciation. What was the company's net cash flow for the year? Last year Shipman, Inc. had $109,000 in operating income. The company had depreciation expense of $37,000, interest expense of $23,400, and a corporate tax rate of 40 percent. The company has $378,000 in current assets and $90,000 in non-interest-bearing current liabilities; it has $266,000 in net plant and equipment. It estimates that it has an after-tax cost of capital of 12 percent. Assume that its only noncash item was depreciation. What was the company's net cash flow for the year?

Answer rating: 100% (QA)

To calculate the net cash flow for the year we need to consider the components of the cash f... View the full answer