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Net Income and OCF During the year, Belyk Paving Co. had sales of $1,745,000. Cost of goods sold, administrative and selling expenses, and depreciation expense were $880,000, $470,000, and $385,000, respectively. In addition, the company had an interest expense of $195,000 and a tax rate of 21 percent. (Ignore any tax loss carryforward provision and assume interest expense is fully deductible.) a. What is the company's net income? b. What is its operating cash flow? e. Explain your results in parts (a) and (b).

Net Income and OCF During the year, Belyk Paving Co. had sales of $1,745,000. Cost of goods sold, administrative and selling expenses, and depreciation expense were $880,000, $470,000, and $385,000, respectively. In addition, the company had an interest expense of $195,000 and a tax rate of 21 percent. (Ignore any tax loss carryforward provision and assume interest expense is fully deductible.) a. What is the company's net income? b. What is its operating cash flow? e. Explain your results in parts (a) and (b).

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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LO2 17. Net Income and OCF During the year, Belyk Paving Co. had sales of $1,745,000. Cost of goods sold, administrative and selling expenses, and depreciation expense were $880,000, $470,000, and $385,000, respectively. In addition, the company had an interest expense of $195,000 and a tax rate of 21 percent. (Ignore any tax loss carryforward provision and assume interest expense is fully deductible.) a. What is the company's net income? b. What is its operating cash flow? e. Explain your results in parts (a) and (b).
Transcribed Image Text:LO2 17. Net Income and OCF During the year, Belyk Paving Co. had sales of $1,745,000. Cost of goods sold, administrative and selling expenses, and depreciation expense were $880,000, $470,000, and $385,000, respectively. In addition, the company had an interest expense of $195,000 and a tax rate of 21 percent. (Ignore any tax loss carryforward provision and assume interest expense is fully deductible.) a. What is the company's net income? b. What is its operating cash flow? e. Explain your results in parts (a) and (b).
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