Answer:
$109,085
Explanation:
From the question above RTF oil has a total sales of $911,500
The costs incurred by RTF oil is $787,300
Depreciation is $52,600
The tax rate is 21 percent
= 21/100
= 0.21
The first step is to calculate the EBIT
EBIT= Total sales-costs-depreciation
EBIT= $911,400-$787,300-$52,600
EBIT = $71,500
The next step is to calculate the tax
Tax= EBIT× tax rate
= $71,500×0.21
= $15,015
Therefore since we have gotten the tax and EBIT, the final stage is to calculate the operating cash flow
OCF= EBIT + depreciation- Tax
= $71,500+$52,600-$15,015
= $124,100-$15,015
= $109,085
Hence RTF oil has an operating cash flow of $109,085
