To find the Operating Cash Flow (OCF) for Graff, Incorporated, we use the following formula:

$\text{OCF} = (\text{Sales} - \text{Costs} - \text{Depreciation}) \times (1 - \text{Tax Rate}) + \text{Depreciation}$

Given dataTo find the Operating Cash Flow (OCF) for Graff, Incorporated, we use the following formula:

$\text{OCF} = (\text{Sales} - \text{Costs} - \text{Depreciation}) \times (1 - \text{Tax Rate}) + \text{Depreciation}$

Given

• Sales = $39,230
• Costs = $12,930
• Depreciation = $2,630
• Interest Expense = $1,910 (not used in OCF calculation)
• Tax Rate = 22% or 0.22

Let's calculate it step-by-step:

1. Calculate the Earnings Before Interest and Taxes (EBIT): $\text{EBIT} = \text{Sales} - \text{Costs} - \text{Depreciation}$

2. Compute EBIT: $\text{EBIT} = 39,230 - 12,930 - 2,630$

3. Calculate the tax impact on EBIT: $\text{Tax Impact} = \text{EBIT} \times \text{Tax Rate}$

4. Subtract the tax impact from EBIT and add back Depreciation to find OCF: $\text{OCF} = (\text{EBIT} - \text{Tax Impact}) + \text{Depreciation}$

Let’s perform these calculations now.The Operating Cash Flow (OCF) for Graff, Incorporated is $21,093.

Do you have any further questions, or would you like more details on how this calculation was performed?

Here are some related questions you might find helpful:

1. What is the significance of Operating Cash Flow in financial analysis?
2. How does depreciation affect the Operating Cash Flow?
3. Why is interest expense not included in the OCF calculation?
4. How would a change in the tax rate affect the Operating Cash Flow?
5. What is the difference between Operating Cash Flow and Net Income?

Tip: Operating Cash Flow provides insight into a company's ability to generate cash from its regular business operations, which is crucial for maintaining and growing the business.