During 2012, Thorold Umbrella Corp. had sales of $730,000 Cost of goods sold, administrative and selling expenses, and depreciation expenses were $580,000, $105,000, and $135,000, respectively. In addition, the company had an interest expense of $75,000 and a tax rate of 35 percent. (Ignore any tax loss carry-back or carry forward provisions.)

a. What is Thorold’s net income for 2012?

b. What is its operating cash flow?

c. Explain your results in (a) and (b).