Question

Moby Corporation has sales of $4,105,524; income tax of $566,347; the selling, general and administrative expenses...

Moby Corporation has sales of $4,105,524; income tax of $566,347; the selling, general and administrative expenses of $259,23; depreciation of $353,132; cost of goods sold of $2,743,532; and interest expense of $117,874. Calculate the amount of the firm's after-tax cash flow from operations?

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Answer #1

First we will calculate net income as per below:

Net income = Sales - Cost of goods sold - Depreciation - Selling, general and administrative expense - interest expense - Income tax expense

putting the values in the above equation, we get,

Net income = $4105524 - $2743532 - $353132 - $25923 - $117874 - $566347

Net income = $298716

Now, After tax cash flow from operations is:

After tax cash flow from operations = Net income + Depreciation

After tax cash flow from operations = $298716 + $353132

After tax cash flow from operations = $651848

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