Reference no: EM132798248

In a finance class, your professor says that to calculate cash flow from operations, you need to subtract total cash expenses and taxes paid from total revenues. That is, operating cash flows = revenues - cash expenses - taxes paid. One student says that this is wrong, as non-cash expenses are also part of total expenses and thus should be deducted from total revenues. Another student adds that there is also no deduction of interest expense, so it understates the tax burden. Provide your explanation.