Find the Free Cash Flow for the following company: Balance Sheet Assets Liabliti

Question

Find the Free Cash Flow for the following company: Balance Sheet Assets Liablities & Owners' Equity Income Statement 2009 2010 Current Assets Current Liabilitios Net sales 1,50 Cash Accounts Receivable Inventory $104 60Accounts Payable 232$266 Notes Payable 190 123Cost of goods sold 655Total $428$389 Depreciation Earnings before interest and taxes$694 |Interest Paid Taxable income Taxes Net Income 553 Total Fixed Assets 1112 $1403 $1,644 $1,709 Long-term debt Owners' equity Net Fixed assets $40at- s454| Common stock and 21 640 1,629 1,920 $2,269 pald-in surplus 600 Retained earnings Total $10 2,756 $3,112Addition to retained earnings $309 Dividends Total Liablities & Total assets

Explanation / Answer

Tax rate = Taxes /Taxable Income = 212/624 = 33.97% (approx 34%)
FCF = Net Income + Depreciation - Increase in current assets - decrease in current liabilities - Increase in Fixed Assets + Interest * ( 1-Tax rate) = 412 + 65 - (1403-1112) - (428-389) -(1709-1644) + 70 * ( 1-34%) = 128.20

Best of Luck. God Bless
Please rate Well and Discuss in case of Doubt

Related Questions

Navigate

• Browse (All)
• Browse F
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.