Pineapple Express has selling and administrative expenses of $2,618,costs of goods sold of $24,318,depreciation of $915,and an interest expense of $520.The firm paid $150 in dividends and added $384 to retained earnings for the year.What is the firm's operating cash flow if the tax rate is 35 percent?
What is the operating cash flow?

Question

Quizplus · Accepted Answer

Net income = $150 + $384 = $534 Taxable income = $534 / (1 - 0.35)= $821.54 Tax = 0.35($821.54)= $287.54 Earnings before interest and taxes = $821.54 + $520 = $1,341.54 Operating cash flow = $1,341.54 + $915 - $287.54 = $1,969.00

Pineapple Express Has Selling and Administrative Expenses of $2,618,costs of Goods