Which one of the following is not accurate in depicting the cash flows from operations for an all-equity firm?
A) (revenues − cash expenses)(1 − tax rate) + (depreciation × tax rate)
B) (revenues − expenses − taxes)
C) (net profit + depreciation)
D) (revenues − cash expenses − taxes)

Question

Quizplus · Accepted Answer

The formula (revenues − expenses − taxes) does not take into account the effect of depreciation on cash flow, which is included in the other options.

Which One of the Following Is Not Accurate in Depicting