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9 August, 14:51

Crandall Oil has total sales of $1,349,800 and costs of $903,500. Depreciation is $42,700 and the tax rate is 34 percent. The firm does not have any interest expense. What is the operating cash flow?

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  1. 9 August, 17:26
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    Operating Cash flow = $309,076

    Explanation:

    Operating Cash flow

    Sales = $1,349,800

    -Costs = $903,500

    -Depreciation = $42,700

    Operating Income = $403,600

    -Tax = $137,224

    Net Income = $266,376

    Operating Cash Flow = Net Income + Non-Cash Expenses - Increase in Working Capital

    Operating Cash flow = $266,376 + $42,700 - 0

    Operating Cash flow = $309,076
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