Year 0 Year 1 Year 2 Year 3 PANEL A Before-tax cash flow
($1,000) $100 $100 $1,100 (CF) Basis $1,000 $1,000 $1,000 $1,000 Taxes on coupons ($28) ($28) ($28) After-tax CF ($1,000) $72 $72 $1,072 After-tax yield (IRR) 7.
Often value is estimated using a debt-free assumption, where net operating income [NOI] and before-tax cash flow
[BTCF] are the same amount.
The estimate of the before-tax cash flow
or amount that will affect an after-tax cash flow, e.
PGI = Potential gross income V&RL = Vacancy and rent loss EGI = Effective gross income OE = Operating expenses NOI = Net operating income DS = Debt service + interest BTCF = Before-tax cash flow
TAXES = Federal and state income taxes ATCF = After-tax cash flow
Subtracting $80 interest expense, before-tax cash flow is $20.
Interest expense (10% of an $800 loan) is also subtracted, to result in annual before-tax cash flow of $20.
COMPAQ'S BEFORE-TAX CASH FLOWS FROM ITS TRANSACTION IN SHELL STOCK.
The after-tax CCFs are just the before-tax cash flows
to both debt and equity, reduced by taxes including interest tax shields.
PPG estimates the net present value of the future before-tax cash flows
generated by this lease will total approximately $50 million over the life of the anticipated well development, which is estimated to be over 30 years.
These transactions will allow us to benefit from the Indian Coal Production Tax Credits available under the Federal Energy Policy Act of 2005 and could increase Westmoreland's before-tax cash flows
A favorable Private Letter Ruling from the Internal Revenue Service, if received by next spring, could increase Westmoreland's before-tax cash flows
Again the proof is that the before-tax cash flows
to the equity position of $5,740,645 equate to an IRR of 18.