After a trip to Bordeaux, France, you are considering opening a restaurant based on Restaurant LEntrecote. You will offer a fixed menu of salad, steak, and french fries. You plan to run the restaurant for two years and then retire. Start-up costs, to be incurred immediately, are $500,000. Start-up costs include kitchen equipment, kitchen supplies, renovations, furniture, fixtures, and the point-of-sales system. The assets can be sold for $150,000 after two years. You expect 100 diners per night and the restaurant will be open for 300 nights per year. The average diner orders food with a menu price of $35 and beverages with a menu price of $15. Food costs are 34% of the menu price and beverage costs are 50% of the menu price. The nightly wages are $2,160 (for the chef, 5 kitchen staff, a bartender, the Maitre d, and 10 wait staff). Municipal tax, rent, and utilities are $41,400 per annum. Assume that all revenues and operating expenses are received (paid) at the end of each year. The small business tax rate is 20%. When the restaurant opens, you will have to invest in an inventory of wine, beer, and liquor costing $50,000. What are the operating cash flows at the end of Year 1?

	a.	$271,400
	b.	$100,000
	c.	$202,880
	d.	$182,880
	e.	$128,600