Question

Nimitz Rental Company provided the following information to its auditors. For the year ended March 31, 2013, the company had revenues of $871,731, general and administrative expenses of $352,928, depreciation expenses of $131,455, leasing expenses of $108,195, and interest expenses equal to $78,122. If the company's tax rate is 34 percent. What is the cash flow for Nimitz Rental?

Answer 1

Answer:

264,136 Cash flow for Nimitz Rental

Explanation:

First we calculate the net income:

871,731      Sales

-352,928  general and administrative expenses

-131,455    depreciation expenses

-108,195    leasing expenses

-78,122      interest expenses

201,031     Income before taxes

(68350)    Income tax expense

132,681     Net income

Then we remove the non-monetary expense

132,681     Net income

+131,455 depreciation expense

264,136 Cash flow for Nimitz Rental