Cash inflow and cash outflow analysis

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Reference no: EM13950103

The owner of a bicycle repair shop forecasts revenues of $228,000 a year. Variable costs will be $67,000, and rental costs for the shop are $47,000 a year. Depreciation on the repair tools will be $27,000. The tax rate is 30%. a. Calculate operating cash flow for the year by using all three methods:

a. adjusted accounting profits;

b. cash inflow/cash outflow analysis; and

c. the depreciation tax shield approach.

b. Are the above answers equal?

Reference no: EM13950103

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