Depreciation and accounting cash flow   A firmin the third year of depreciating its only​ asset,which originallycost $175,000and has a​ 5-yearMACRS recovery period

Rounded Depreciation Percentages by Recovery Year UsingMACRS for First Four Property Classes
	Percentage by recovery​ year*
Recovery year	3 years	5 years	7 years	10 years
1	3333​%	2020​%	1414​%	1010​%
2	4545​%	3232​%	2525​%	1818​%
3	1515​%	1919​%	1818​%	1414​%
4	77​%	1212​%	1212​%	1212​%
5		1212​%	99​%	99​%
6		55​%	99​%	88​%
7			99​%	77​%
8			44​%	66​%
9				66​%
10				66​%
11				44​%
Totals	100100​%	100100​%	100100​%	100100​%

has gathered the following data relative to the current​year'soperations:

Accruals	$15,300
Current assets	125,000
Interest expense	15,600
Sales revenue	401,000
Inventory	71,000
Total costs before​ depreciation, interest and taxes	288,000
Tax rate on ordinary income	21 %21%

1. Use the relevant data to determine the operating cashflow for the current year.

Complete the following table to determine the operating cashflow​ (OCF):  ​(Round to the nearest​ dollar.)

Operating Cash Flow
Sales revenue	$
Less: Total costs before depreciation, interest, andtaxes
Depreciation expense
Earnings before interest and taxes	$
Less: Taxes at 21%
Net operating profit after taxes (NOPAT)	$
Plus: Depreciation
Operating Cash Flow (OCF)	$

Enter any number in the edit fields and then click CheckAnswer.

b. Explain the impact that​ depreciation, aswell as any other noncash​ charges, has on a​ firm's cashflows.