Question
In: Finance
This year, FCF Inc. has earnings before interest and taxes of $9,420,000, depreciation expenses of $1,400,000,...
This year, FCF Inc. has earnings before interest and taxes of
$9,420,000,
depreciation expenses of
$1,400,000,
capital expenditures of
$1,500,000,
and has increased its net working capital by
$475,000.
If its tax rate is
38%,
what is its free cash flow?
Round to to 2 decimals
Solutions
Expert Solution
| Answer: | |
| Calculation of free cash flow | |
| Particular | Amount (in Dollar) |
| EBIT | 9,420,000.00 |
| Less : Interest Expense | - |
| EBT | 9,420,000.00 |
| Less : Tax @38% | 3,579,600.00 |
| Earning after tax | 5,840,400.00 |
| Add: Depreciation expense | 1,400,000.00 |
| Cash flow from operation | 7,240,400.00 |
| Less: Capital Expenditure | 1,500,000.00 |
| Less: Increase in net working capital | 475,000.00 |
| Free cash flow | 5,265,400.00 |
| So, Free cash flow is $5,265,400 (Answer) |
jeff jeffy answered 1 year agoRelated Solutions
Earnings before depreciation, interest, and taxes $1,600,000 Depreciation expense
Earnings before depreciation, interest, and
taxes $1,600,000
Depreciation
expense $100,000
Tax
rate 40%
Interest
expense $10,000
Common
dividends
paid $200,000
Number
of shares of common stock
outstanding $500,000
a.
1.79
b.
1.39
c.
3.20
d.
1.20
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a. Compute its cash flow.
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Multiple Choice
$68,000
$62,800
$72,600
$71,800
Assume a corporation has earnings before depreciation and taxes of $104,000, depreciation of $42,000, and that...
Assume a corporation has earnings before depreciation and taxes
of $104,000, depreciation of $42,000, and that it has a 30 percent
tax bracket.
a. Compute its cash flow using the following
format. (Input all answers as positive values.)
b. How much would cash flow be if there were only
$16,000 in depreciation? All other factors are the same.
c. How much cash flow is lost due to the
reduced depreciation from $42,000 to $16,000?
PLEASE HELP!!!
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interest and taxes of $2 million per yearHalogen Inc tax rate is
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The firm had depreciation of $80 million and reported capital
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Use the following to answer questions 7-15:
1999 2000
Sales $2900 $3300
Cogs $2030 $2310
Interest $410 $420
Dividends $56 $79
Depreciation $290 $330
Cash $250 $150
Receiviables $242 $412
Current liabilities $900 $1100
Inventory $1015 $900
Long Term Debt $3200 $3100
Net Fixed Assets $6000 $5700
Tax Rate 34% 34%
7. What are earnings before interest and taxes for 2000?
A) $112
B) $158
C) $580
D) $660
E) $780
...
SALES $25,000 COSTS OF GOODS $16,000 DEPRECIATION $3,000 EARNINGS BEFORE INTEREST AND TAXES $6,000 INTEREST PAID...
SALES
$25,000
COSTS OF GOODS
$16,000
DEPRECIATION
$3,000
EARNINGS BEFORE INTEREST AND TAXES
$6,000
INTEREST PAID
$2,000
TAXABLE INCOME
$4,000
TAXES (34%)
$1,360
NET INCOME
$2,640
(ADDITION TO) RETAINED EARNINGS
$1,584
DIVIDENDS
$1,056
CURRENT ASSET
2002
2003
CURRENT LIABILITIES
2002
2003
CASH
$4,000
$3,000
ACCOUNTS PAYABLE
$3,000
$2,500
ACCOUNTS RECEIVABLE
$9,000
$11,000
NOTES PAYABLE
$6,000
$6,416
INVESNTORY
$5,000
$4,500
LONG TERM DEBT
$15,000
$13,000
OWNERS EQUITY
FIXED ASSETS
COMMON STOCK
$14,000
$16,500
NET FIXED ASSET(PLANT AND EQUIPMENT)
$30,000
$31,500
RETAINED...
SALES $25,000 COSTS OF GOODS $16,000 DEPRECIATION $3,000 EARNINGS BEFORE INTEREST AND TAXES $6,000 INTEREST PAID...
SALES
$25,000
COSTS OF GOODS
$16,000
DEPRECIATION
$3,000
EARNINGS BEFORE INTEREST AND TAXES
$6,000
INTEREST PAID
$2,000
TAXABLE INCOME
$4,000
TAXES (34%)
$1,360
NET INCOME
$2,640
(ADDITION TO) RETAINED EARNINGS
$1,584
DIVIDENDS
$1,056
CURRENT ASSET
2002
2003
CURRENT LIABILITIES
2002
2003
CASH
$4,000
$3,000
ACCOUNTS PAYABLE
$3,000
$2,500
ACCOUNTS RECEIVABLE
$9,000
$11,000
NOTES PAYABLE
$6,000
$6,416
INVESNTORY
$5,000
$4,500
LONG TERM DEBT
$15,000
$13,000
OWNERS EQUITY
FIXED ASSETS
COMMON STOCK
$14,000
$16,500
NET FIXED ASSET(PLANT AND EQUIPMENT)
$30,000
$31,500
RETAINED...
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