You are given the following information on Z Corporation and asked to compute fr
ID: 2743035 • Letter: Y
Question
You are given the following information on Z Corporation and asked to compute free cash flow and to give a detailed summary of the disposition of free cash flow.
Beg
End
Cash
123
136
AR
241
255
Inventory
463
460
Mark securities
250
272
Net FA
722
750
1799
1873
AP
300
358
Accrued expense
325
370
NP
250
225
LTD
741
720
Common stock
50
40
Retained earn
122
137
Accum other
11
23
1799
1873
Sales
200
COS
-52
SGA
-26
Oper income
122
Interest income
10
Interest expense
-49.55
EBT
82.45
Tax at 40 percent
-32.98
Net income
49.47
Other accum comp income
12
Comp income
61.47
Beg
End
Cash
123
136
AR
241
255
Inventory
463
460
Mark securities
250
272
Net FA
722
750
1799
1873
AP
300
358
Accrued expense
325
370
NP
250
225
LTD
741
720
Common stock
50
40
Retained earn
122
137
Accum other
11
23
1799
1873
Explanation / Answer
EAT = 49.47 + Interest Exp [49.55*(1-0.40)] 69.37 - Interest Income [ 10*(1-0.40)] 9 + Depreciation 0 + Cash 13 - AR -14 + Inventory 3 + AP 8 + Accrued Exp 45 - NP -25 Cash Flows 157.84 - Capital Exp : FA -28 Free Cash Flows 129.84
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