J's Foods is trying to estimate the cash flows in their first year of operation. They project that the firm will have sales of 100,000; operating costs of 50,000; and depreciation of 10,000. If their tax rate is 15% what would the firm's operating cash flow equal?
Operating cash flow = (Sales - operating costs - depreciation)(1 - tax) + depreciation
Operating cash flow = (100,000 - 50,000 - 10,000)(1 - 0.15) + 10,000
Operating cash flow = (40,000)(0.85) + 10,000
Operating cash flow = $44,000
J's Foods is trying to estimate the cash flows in their first year of operation. They...
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