Answer:
Annual estimated net income is $360,00.
Annual estimated net cash inflow is $216,000.
Explanation:
1. Determine the annual estimated net income
Annual estimated net income = Annual cash inflows - Annual cash outflow
Annual estimated net income = $600,000 - $240,000 = $360,00
2. Determine the annual estimated net cash inflow
Annual Tax = Annual estimated net income × Tax rate
Annual Tax = $360,00 × 40% = $144,000.
Annual estimated net cash inflow = Annual estimated net income - Annual Tax
Annual estimated net cash inflow = $360,00 - $144,000 = $216,000.
Note that depreciation is not considered in the calculation because depreciation not a cash expense.
