The December 31, 2015, balance sheet of Schism, Inc., showed long-term debt of $1,380,000, $136,000 in the common stock account, and $2,610,000 in the additional paid-in surplus account. The December 31, 2016, balance sheet showed long-term debt of $1,540,000, $146,000 in the common stock account, and $2,910,000 in the additional paid-in surplus account. The 2016 income statement showed an interest expense of $92,000 and the company paid out $141,000 in cash dividends during 2016. The firm's net capital spending for 2016 was $920,000, and the firm reduced its net working capital investment by $121,000. What was the firm's 2016 operating cash flow, or OCF?

The firm's 2016 operating cash flow is $562,000

Explanation:

Cash flow to creditors = Interest expense - {Long term debt at end of Year - Long term debt at start of year}

Cash flow to creditors = $92,000 - ($1,540,000 - $1,380,000)

Cash flow to creditors = $92,000 - $160,000

Cash flow to creditors = -$68000.

Cash flow to stockholders = Dividend paid - (Owners' equity at end of Year - Owners' equity at start of year).

Cash flow to stockholders = $141,000 - [($146,000 + $2,910,000) - ($136,000 + $2,610,000)]

Cash flow to stockholders = $141,000 - ($3,056,000 - $2,746,000)

Cash flow to stockholders = $141,000 - $310,000

Cash flow to stockholders = -$169,000.

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

Cash flow from assets = (-$68,000) + (-$169,000 )

Cash flow from assets = -$237,000

Cash flow from assets = Operating cash flow - Change in net working capital  - Net capital spending

-$237000 = Operating cash flow - (-$121000) - $920,000

-$237000 = Operating cash flow + $121,000 - $920,000

Operating cash flow = $920,000 - $237,000 - $121,000

Operating cash flow  = $562,000

answer; dividing net income by 1- t ;

answer the amount a seller is paid minus the cost of production;