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You work for Diversified Industries, and you must estimate the Year 1 operating cash flow for...

You work for Diversified Industries, and you must estimate the Year 1 operating cash flow for a project with the following data. What is the Year 1 after-tax net operating cash flow? Enter your answer rounded to two decimal places. Do not enter $ or comma in the answer box. For example, if your answer is $12,300.456 then enter as 12300.46 in the answer box.

Sales revenues

$155,000

Depreciation

$44,000

Cash operating costs

$68,000

Tax rate

25%

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Answer #1

Operating cash flow = (Sales - costs - depreciation)(1 - tax) + depreciation

Operating cash flow = (155,000 - 68,000 - 44,000)(1 - 0.25) + 44,000

Operating cash flow = 32,250 + 44,000

Operating cash flow = 76250.00

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