operating cash flow. find the operating cash flow for the year for robinson and sons if...

operating cash flow. find the operating cash flow for the year for robinson and sons if it had sales of $81,200,000,,, cost of goods of $35,500,000, sales and administrative costs of $6,200,000, depreciation expense of $7,000,000, and a tax rate 0f 30%. the operating cash flow is ....... (round to the nearest dollar)

Solutions

Expert Solution

Operating cash flow = $29750000

Explanation

Operating Cash Flow = Net Income + Non cash Expense

Net Income = Sales - Cost of Goods - Sales and Administration Cost - Depreciation Expense - Tax Expense

Sales. 81200000

(-) Cost of Goods 35500000

(-)sales and Administration 6200000

(-) Depreciation Expense. 7000000

Income before tax. 32500000

(-) Tax @ 30% 9750000

Net Income 22750000

Note - Depreciation is a non cash Expense as it only reduce the value of fixed assets and has no effect on cash holdings.

Operating cash flow = 22750000 + 7000000

= 29750000

jeff jeffy answered 1 year ago

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