6 (of 9) 10.00 points 6 income statement saies $160.000 costs- $80,500; other ex

Question

6 (of 9) 10.00 points 6 income statement saies $160.000 costs- $80,500; other expenses $3,800, depreciation 000 in new equity during 2016 and redeemed $6,700 in outstanding long-term debt expense $9.500 interest expense- $7,000; taxes s20,720 dividends- $7,00. In addition, you're told that the frm ssued $4 What is the 20168 operating cash tow? (Do not round intermediate calculations and round your answer to the nearest whole number, eg. 32) Operating cash flow and round your answer to the nearest whole number, e.g., 32.) Cash flow to stockholders cakculations and round your answer to the nearest whole number,a.g. 32) 8

Explanation / Answer

Answer of Part a:

Operating Cash Flow = EBIT + Depreciation – Taxes
Operating Cash Flow = $66,200 + $9,500 - $20,720
Operating Cash Flow = $54,980

Answer of Part b:

Cash Flow to Creditors = Interest Paid – Net New Borrowing
Cash Flow to Creditors = $7,000 – ($6,700)
Cash Flow to Creditors = $13,700

Answer of Part c:

Cash Flow to Stockholders = Dividends Paid – Net New Equity
Cash Flow to Stockholders = $7,900 - $4,000
Cash Flow to Stockholders = $3,900

Answer of Part d:

Cash Flow from Assets = Cash Flow to Creditors + Cash Flow to Stockholders
Cash Flow from Assets = $13,700 + $3,900
Cash Flow from Assets = $17,600

Net Capital Spending = Depreciation + Increase in Fixed Assets
Net Capital Spending = $9,500 + $20,950
Net Capital Spending = $30,450

Cash Flow from Assets = Operating Cash Flow – Change in Net Working Capital – Net Capital Spending
$17,600 = $54,980 – Change in Net Working Capital - $30,450
Change in Net Working Capital = $54,980 - $30,450 - $17,600
Change in Net Working Capital = $6,930

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