The One Cafe has an operating cash flow of $78,460, a depreciation expense of $8,960, and taxes paid of $21,590. What is the amount of the cash flow from assets? A partial balance sheet is as follows:
Beginning Balance Ending Balance
Current assets $141,680 $138,509
Net fixed assets $687,810 $703,411
Current liabilities $87,340 $91,516
Long-term debt $267,000 $248,000
To calculate the cash flow from assets, you can use the formula:
Cash Flow from Assets = Operating Cash Flow - Taxes Paid - Net Capital Spending
1. First, let's calculate the Net Capital Spending.
Net Capital Spending = Ending Net Fixed Assets - Beginning Net Fixed Assets + Depreciation Expense
In this case:
Net Capital Spending = $703,411 - $687,810 + $8,960
Net Capital Spending = $24,561
2. Now, we can calculate the Cash Flow from Assets.
Cash Flow from Assets = Operating Cash Flow - Taxes Paid - Net Capital Spending
Cash Flow from Assets = $78,460 - $21,590 - $24,561
Cash Flow from Assets = $32,309
Therefore, the amount of the cash flow from assets for The One Cafe is $32,309.