A gym owner is considering opening a location on the other side of town. The new facility will cost $1.36 million and will be depreciated on a straight-line basis over a 20-year period. The new gym is expected to generate $537,000 in annual sales. Variable costs are 49 percent of sales, the annual fixed costs are $86,100, and the tax rate is 35 percent. What is the operating cash flow?

Multiple Choice

• $190,051

• $145,851

• $316,885

• $89,520

• $211,570