Answer:
Project's operating cash flow = $31,846.25
Explanation:
Value derived from Selling of Fleece Tops
Sales = (4,000*$57) = $228000
Variable Cost (4,000*$31) = $124000
Total Value from Fleece Tops = $228000 - $124000 = $104,000
Value derived from Sales of Additional Jeans
Sales (255*$67) = $17085
Variable Cost (255*$36) = $9180
Total Value from Fleece Tops = $17085 - $9180 = $7905
Value Lost from Decline in Sales of T-Shirts
Sales (-390*$28) = -$10920
Variable Cost (-390*$16) = -$6240
Total Value from Fleece Tops = -$10920 - (-$6240) = -$10920 + $6240 = -$4680
Projects Operating Cash Flow = [($104,000 + $7905 - $4680) - $76,000]*(1-0.35) + $33,000 * 0.35
Projects Operating Cash Flow = ($31225 * 0.65) + ($33,000 * 0.35)
Projects Operating Cash Flow = $20296.25 + $11550
Projects Operating Cash Flow = $31,846.25