Ok--I've been struggling with this problem all day.

I have values for EBIT (750,000), depreciation (200,000), and the tax rate(.4). I need to find net income and net cash flow.

Here's what I have so far: net cash flow = net income + depreciation. If depreciation is given, how am I supposed to get net income and net cash flow? No other information was given.

It's difficult to determine that answer.

In your income statement, depreciation helps to make up the EBIT. If you know the interest take that out next. This will make your taxable income. From there, deduct your total taxes to find the Net Income.

Then you know that your Net Cash Flow = Net Income + Depreciation/Amortization

Hope this helps.

Thanks for your help, but that's exactly where I got stuck. The only useful information that I have is the equation for net cash flow, but there are 2 missing variables : net cash flow and net income.

Depreciation is 200,000
EBIT is 750,000
and the tax rate is .4

So, hence, the stuckness (lol).

Thanks again!