Smith Manufacturing Inc.expects the following results in year one of a new project:

The annual change in operating cash flow is equal to

Question

Smith Manufacturing Inc.expects the following results in year one of a new project:

The annual change in operating cash flow is equal to

Quizplus · Accepted Answer

The annual change in operating cash flow can be calculated by subtracting the previous year's operating cash flow from the current year's operating cash flow. Using the table provided, the operating cash flows for year one and year zero are $686,000 and $484,000, respectively. Therefore, the annual change in operating cash flow is $686,000 - $484,000 = $202,000.