Asked by
Isaac Muhoro
on Dec 09, 2024Verified
Le Place has sales of $439,000, depreciation of $32,000, and net working capital of $56,001. The firm has a tax rate of 34% and a profit margin of 6%. The firm has no interest expense. What is the amount of the operating cash flow?
A) $49,384
B) $52,616
C) $54,980
D) $58,340
E) $114,340
Operating Cash Flow
A financial metric that indicates the amount of money generated by a company's business operations after accounting for operating expenses.
Net Working Capital
A measure of a company's short-term financial health and liquidity, calculated as current assets minus current liabilities.
Profit Margin
A financial metric expressing the ratio of a company's net income to its sales, demonstrating the percentage of revenue that exceeds the cost of goods sold.
- Assess the cash flows arising from operational activities, taking into account tax effects, depreciation, and changes in net working capital.
Verified Answer
JA
Learning Objectives
- Assess the cash flows arising from operational activities, taking into account tax effects, depreciation, and changes in net working capital.