Question: Operating Cash Flow = EBIT + Depreciation - Tax = 3396 + 1611 - 740 = 4267 Net Capital Spending = Ending Net Fixed Assets

Operating Cash Flow = EBIT + Depreciation - Tax

= 3396 + 1611 - 740 = 4267

Net Capital Spending = Ending Net Fixed Assets - Beginning Net Fixed Assets + Depreciation

= 17107 - 17489 + 1611 = 1229

Change in NWC = (Ending Current Assets - Ending Current Liabilities) - (Beginning Current Assets - Beginning Current Liabilities)

= (4771 - 1532) - (6127 - 4194)

= 3239 - 1933 = 1306

Cash Flow from Assets = Operating Cash Flow - Net Capital Spending - Change in NWC

= 4267 - 1829 - 1306

Cash Flow from Assets = 1132

a)Based on the calculation in part (a) above, comment on the liquidity position of the firm.

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