Torvane starts from its profit before tax of 870,000 (presentation chosen by the entity, case data). It includes depreciation 264,000, loss on disposal 17,000 and interest expense 53,000; interest paid is classified as financing (entity policy). Inventories rise by 91,000, receivables fall by 36,000, payables rise by 28,000. Tax paid is 204,000. Compute net operating cash flow.
- Profit before tax
- 870,000
- Depreciation
- 264,000
- Loss on disposal
- 17,000
- Interest expense
- 53,000
- Increase in inventories
- 91,000
- Decrease in receivables
- 36,000
- Increase in payables
- 28,000
- Tax paid
- 204,000