Cash Flows from Project/Operations
Revenues
- Costs of Goods Sold
- Selling, General & Admin. costs
- Depreciation
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= Operating Profits
- Cash Taxes on Operating Profit
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= Net Operating Profits After Tax
+ Depreciation
- Capital Expenditures
- Increases in Working Capital
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= Cash Flows from Operations
Depreciation: Think of depreciation as the main non-cash item that has tax implications.
Working Capital = Cash + Inventory + Acct Receivable - Acct Payable
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