Because it was high school. Right?
Answer:
$2.46 million.
Explanation:
Profit before tax:
= Sales - Variable costs - Depreciation
= $7.20 - $4.20 - $1.20
= $1.80 million
Net income = Profit before tax - Tax
= $1.80 million - (30% × $1.80)
= $1.80 million - $0.54 million
= $1.26 million
(1) Adjusted accounting profits method:
= Net income + Depreciation
= $1.26 + $1.2
= $2.46 million
(2) Cash inflow/Cash outflow method:
= Sales - Cash expenses - Tax
= 7.2 - 4.2 - 0.54
= $2.46 million
(3) Depreciation tax shield method:
= [(Sales - Costs) × (1-Tax rate)] + (Depreciation × Tax rate)
= [(7.2 - 4.2) × (1 - 30%)] + (1.20 × 30%)
= $2.46 million
Therefore, operating cash flow from all the three method is $2.46 million.
Answer:
b. cost of goods purchased
Explanation:
Cost of goods available for sale is the maximum amount of goods or services a company can sell during a given period which is usually a fiscal year.
Cost of good available for sale = beginning inventory + Cost of goods purchased + Cost of goods produced.
I hope my answer helps you.