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Calculate the operating cash flow for the repair shop

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Reference no: EM132630772

The owner of a bicycle repair shop forecasts revenues of 220,000 a year. Variable costs for the shop are $65000, and rental costs for the shop $45000 a year. Depreciation on the repair tools will be $2500.

A. Prepare income statement for the shop based on these estimates. The tax rate is %20.

B. Calculate the operating cash flow for the repair shop using the three methods given below:

-dollars in minus dollars out

-Adjusted accounting profits

-after tax operating cash flow

Reference no: EM132630772

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