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need help with A and B The owner of a bicycle repair shop forecasts revenues of $160,000 a year. Variable costs will be $50,000, and
need help with A and B
The owner of a bicycle repair shop forecasts revenues of $160,000 a year. Variable costs will be $50,000, and rental costs for the shop are $30,000 a year. Depreciation on the repair tools will be $10,000. a. Prepare an income statement for the shop based on these estimates. The tax rate is 20%. Methods of Calculation i. Dollars in minus dollars out ii . Adjusted Accounting profits iii. After tax Operating Cash flow Operating Cash flow $ 7,000 $ 14,000 $ 80,000 b. Calculate the operating cash flow for the repair shop using the three methods given below: i. Dollars in minus dollars out. ii. Adjusted accounting profits. ii. Add back depreciation tax shield. Methods of Calculation Operating Cash flow i. Dollars in minus dollars out ii. Adjusted Accounting profits iii. After tax Operating Cash flowStep by Step Solution
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