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Alekssandra [29.7K]
4 years ago
7

Benson, Inc., has sales of $38,530, costs of $12,750, depreciation expense of $2,550, and interest expense of $1,850. The tax ra

te is 21 percent. What is the operating cash flow, or OCF?
Business
1 answer:
Sloan [31]4 years ago
7 0

Answer:

Operating Cash flow is $19,440

Explanation:

Operating Cash flow

Sales                         = $38,530

-Costs                        = $12,750

-Depreciation            <u>= $2,550</u>

Operating Income    = $23,230

-Interest Expense     = $1,850

Income before Tax  = $21,380

-Tax                           <u>= $4,490</u>

Net Income               = $16,890

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

Operating Cash flow = $16,890 + $2,550 - 0

Operating Cash flow = $19,440

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