The 2014 balance sheet of Sugarpovas Tennis Shop Inc showed

The 2014 balance sheet of Sugarpova\'s Tennis Shop, Inc., showed long-term debt of $5.6 million, and the 2015 balance sheet showed long-term debt of $5.8 million. The 2015 income statement showed an interest expense of $185,000. During 2015, the company had a cash flow to creditors of -$15,000 and the cash flow to stockholders for the year was $65,000. Suppose you also know that the firm’s net capital spending for 2015 was $1,410,000, and that the firm reduced its net working capital investment by $77,000. Whatt\'s the operating cash flow?

Solution

Cash flow from assets = Cash flow to creditors + Cash flow to stockholders = -15000+65000 = 50000 Operating cash flow = 50000-77000+1410000= 1383000