Question: Operating cash flow. Grady Precision Measurement Tools has forecasted the following sales and costs for a new GPS system: annual sales of 40,000 units at $19 a unit, production costs at 40% of sales price, annual fixed costs for production at $130,000, and straight-line depreciation expense of $205,000 per year. The company tax rate is 38%.
What is the annual operating cash flow of the new GPS system?