The 2017 balance sheet of Kerber's Tennis Shop, Inc., showed long-term debt of $1.87 million, and the 2018 balance sheet showed long-term debt of $2.21 million. The 2018 income statement showed an interest expense of $255,000. During 2018, Kerber's Tennis Shop, Inc., realized the following: Cash flow to creditors Cash flow to stockholders -$ 85,000 $170,000 Suppose you also know that the firm's net capital spending for 2018 was $1,250,000, and that the firm reduced its net working capital investment by $45,000.
The 2017 balance sheet of Kerber's Tennis Shop, Inc., showed long-term debt of $1.87 million, and the 2018 balance sheet showed long-term debt of $2.21 million. The 2018 income statement showed an interest expense of $255,000. During 2018, Kerber's Tennis Shop, Inc., realized the following: Cash flow to creditors Cash flow to stockholders -$ 85,000 $170,000 Suppose you also know that the firm's net capital spending for 2018 was $1,250,000, and that the firm reduced its net working capital investment by $45,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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![The 2017 balance sheet of Kerber's Tennis Shop, Inc., showed long-term debt of $1.87
million, and the 2018 balance sheet showed long-term debt of $2.21 million. The 2018
income statement showed an interest expense of $255,000. During 2018, Kerber's
Tennis Shop, Inc., realized the following:
Cash flow to creditors
Cash flow to stockholders
-$ 85,000
$170,000
Suppose you also know that the firm's net capital spending for 2018 was $1,250,000,
and that the firm reduced its net working capital investment by $45,000.
What was the firm's 2018 operating cash flow, or OCF? Hint use the cash flow identity to
solve for OCF. If you don't know what that is, review the text and lectures. (Enter your
answer in dollars, not millions of dollars, e.g., 1,234,567.)
Operating cash flow](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F927ce6e0-a1c9-42d1-bce4-93f1d9a436b6%2F285a4f91-1009-4624-be94-4fd350c6d4cc%2Fxgwktvp_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The 2017 balance sheet of Kerber's Tennis Shop, Inc., showed long-term debt of $1.87
million, and the 2018 balance sheet showed long-term debt of $2.21 million. The 2018
income statement showed an interest expense of $255,000. During 2018, Kerber's
Tennis Shop, Inc., realized the following:
Cash flow to creditors
Cash flow to stockholders
-$ 85,000
$170,000
Suppose you also know that the firm's net capital spending for 2018 was $1,250,000,
and that the firm reduced its net working capital investment by $45,000.
What was the firm's 2018 operating cash flow, or OCF? Hint use the cash flow identity to
solve for OCF. If you don't know what that is, review the text and lectures. (Enter your
answer in dollars, not millions of dollars, e.g., 1,234,567.)
Operating cash flow
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