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The owner of a bicycle repair shop forecasts revenues of $236,000 a year. Variable costs will be $69,000 and rental costs for the shop are $49,000 a year. Depreciation on the repair tools will be $29,000. Prepare an income statement for the shop based on these estimates. The tax rate is 20%. Calculate the operating cash flow by using the three methods given below. Dollars in minus dollars out adjusted accounting profits after tax operating cash flow

User Charmeleon
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Answer:

Step-by-step explanation:

INCOME STATEMENT

Revenue $236,000

Variable cost $69,000

Rental Cost $49.000

Depreciation $29,000

Pretax profit $89,000

Taxes $17,800

Net incomes $71,200

Net Income 71200

Depr. Expense 29000

Increase in AR -236000

Increase in AP $ 135800

Operating Cash Flow 0