PLEASE HELP COMPLETE CHART BELOW 2. Compute Carmono’s free cash flow for this ye

Question

PLEASE HELP COMPLETE CHART BELOW

2. Compute Carmono’s free cash flow for this year

Comparative financial statement data for Carmono Company follow: This Year Last Year Assets as Accounts receivable Inventory $ 17.00 33.00 81.00 40.00 128.60 88.00 Total current assets 245.00 242.60 Property, plant, and equipment 288.00 232.00 45.60 Less accumulated depreciation 60.80 Net property, plant, and equipment 227.20 186.40 Total assets 472.20 $429.00 Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings 84.00 65.00 94.00 148.00 194.20 216.00 Total liabilities and stockholders' equity 472.20 429.00 For this year, the company reported net income as follows ales Cost of goods sold $1,800.00 1,080.00 Gross margin Selling and administrative expenses 720.00 700.00 Net income $ 20.00

Explanation / Answer

2) Compute Carmono’s free cash flow for this year

Carmono’s free cash flow = Net cash provided by operating activities - Increase in Plant & Equipment- cash dividend

Carmono’s free cash flow = 35.80 - 56-41.80

Carmono’s free cash flow = -62

Carmono Company Statement of Cash Flows For the Year Ended December 31 Operating activities Net income 20.00 Adjustments to convert Net Income to Cash Basis Depreciation 15.20 Increase in Accounts receivable -7.00 Decrease in inventories -11.40 Increase in Accounts payable 19.00 15.80 Net cash provided by operating activities. 35.80 Investing activities Increase in Plant & Equipment -56.00 Net cash used in investing activities -56.00 Financing activities Common stock Issued 46.00 Cash Dividend -41.80 Net cash provided by financing activities 4.20 Net increase in cash -16.00 Beginning Cash and cash equivalents 33.00 Ending Cash and cash equivalents 17.00

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