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Depreciation and accounting cash flow???A firm in the third yearof depreciating its only? asset, which originally cost $ 184,000and has a? 5-year MACRS recovery period has gathered the followingdata relative to the current? year's operations: Accruals $ 15,800Current assets 113,000 Interest expense 14,500 Sales revenue402,000 Inventory 69,900 Total costs before? depreciation, interestand taxes 291,000 Tax rate on ordinary income 21 %a. Use the relevant data to determine the operating cash flowfor the current year.b. Explain the impact that? depreciation, as well as any othernoncash? charges, has on a? firm's cash flows.
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