Lush Cash Flow Spurs Business
Corporate cash flow is defined as retained earnings plus depreciation but practically is what remains after operating expenses taxes and current dividends. This year cash flow remains strong with a six billion rate in 1983 and $74 billion in cash on hand across corporate America. Depreciation now drives most cash flow aided by relaxed federal rules boosting depreciation by about $1.5 billion and a further billion from a 7 percent tax incentive. If Congress lowers corporate tax rates cash flow could rise, though next year effects are muted by a faster tax payment schedule.