The 2017 balance sheet of kerber's tennis shop, inc., showed long-term debt of $6.2 million, and the 2018 balance sheet showed long-term debt of $6.4 million. the 2018 income statement showed an interest expense of $215,000. during 2018, the company had a cash flow to creditors of $15,000 and the cash flow to stockholders for the year was $70,000. suppose you also know that the firm’s net capital spending for 2018 was $1,470,000, and that the firm reduced its net working capital investment by $89,000. what was the firm’s 2018 operating cash flow, or ocf?

The firm’s 2018 operating cash flow, or OCF is $1466000.

Explanation:

Cash flow from assets = Cash flow to creditors + Cash flow to stockholders

= $15,000 + $70,000

= $85,000

Cash flow from assets = Operating Cash Flow - Change in Net Working Capital - Net capital spending

$85,000 = Operating Cash Flow - (-$89,000) - $1,470,000

Operating Cash Flow = $85,000 - $89,000 + $1,470,000

                                    = $1466000

Therefore, The firm’s 2018 operating cash flow, or OCF is $1466000.

hi there, i would say your answer is:

b. there is a fixed quantity of resources and technology available.

hope that : )