Question

In: Finance

ABC Corp, has a EBIT of $599,843. Their depreciation expense is $80,097, their net working capital...

ABC Corp, has a EBIT of $599,843. Their depreciation expense is $80,097, their net working capital increased by $17,154, and they spent $172,704 on capital assets. What is their unlevered cash flow if their tax rate is 0.32?

Solutions

Expert Solution

Unlevered Cash Flows

EBIT $ 599,843.00
Less: Tax @ 32% $ 191,950.00
EAT $ 407,893.00
Add: Depreciation $    80,097.00
Less: Increase in Working Capital $    17,154.00
Less: Capital Expenditure $ 172,704.00
Unlevered Cash Flows $ 298,132.00

Related Solutions

ABC Corp, has a EBIT of $462,466. Their depreciation expense is $80,500, their net working capital...
ABC Corp, has a EBIT of $462,466. Their depreciation expense is $80,500, their net working capital increased by $17,970, and they spent $129,681 on capital assets. What is their unlevered cash flow if their tax rate is 0.35?
A firm has EBIT of $300,000 and depreciation expense of $12,000. Fixed charges total $44,000.
A firm has EBIT of $300,000 and depreciation expense of $12,000. Fixed charges total $44,000. Interest expense totals $7,000. What is the firm's cash coverage ratio?Multiple Choice3.76 times4.91 times7.25 times7.09 times
ABC Inc. has sales of $44,500, costs of $19,400, depreciation expense of $2,900, and interest expense...
ABC Inc. has sales of $44,500, costs of $19,400, depreciation expense of $2,900, and interest expense of $2,400. If the tax rate is 35%, what is the operating cash flow, or OCF? (Omit $ sign in your response.)
Saunders Corp. has a book net worth of $11,150. Long-term debt is $2,300. Net working capital,...
Saunders Corp. has a book net worth of $11,150. Long-term debt is $2,300. Net working capital, other than cash, is $2,950. Fixed assets are $2,750 and current liabilities are $1,500.    Required: (a) How much cash does the company have?   (Click to select)   9,250   10,700   8,400   9,528   8,972    (b) What is the value of the current assets?   (Click to select)   13,015   4,450   14,385   13,426   13,700
johnson's nursery has net income of 42,500, depreciation expense of 2500, interest expense of 1000 ,...
johnson's nursery has net income of 42,500, depreciation expense of 2500, interest expense of 1000 , taxes of 1600, additions to net working capital of 2600, cash dividends of 4200 and capital Expedientes 11,400 what is the amount of free cash flow?
Define each of the following terms: Working capital – Net working capital – Net operating working...
Define each of the following terms: Working capital – Net working capital – Net operating working capital – Explain the following operating current asset investment policies. Relaxed policy – Restricted policy – Moderate policy –
What is the definition of net working capital? Net working capital is the difference between a...
What is the definition of net working capital? Net working capital is the difference between a firm's current assets and current liabilities.            Net working capital is the sum of a firm's cash and marketable securities accounts. Net working capital is the value of a firm's assets that can be converted into cash in one year or less.         Net working capital is the amount of cash a firm has on hand as of a specific date.
Define working capital, net working capital, and working capital management. What is the role of the...
Define working capital, net working capital, and working capital management. What is the role of the manager in working capital management? What are marketable securities? What are the two main types of marketable securities?
Dewey Corp. is expected to have an EBIT of $3,250,000 next year. Depreciation, the increase in...
Dewey Corp. is expected to have an EBIT of $3,250,000 next year. Depreciation, the increase in net working capital, and capital spending are expected to be $260,000, $165,000, and $265,000, respectively. All are expected to grow at 18 percent per year for four years. The company currently has $21,000,000 in debt and 875,000 shares outstanding. At Year 5, you believe that the company's sales will be $29,000,000 and the appropriate price-sales ratio is 2.5. The company’s WACC is 8.8 percent...
Dewey Corp. is expected to have an EBIT of $3,050,000 next year. Depreciation, the increase in...
Dewey Corp. is expected to have an EBIT of $3,050,000 next year. Depreciation, the increase in net working capital, and capital spending are expected to be $240,000, $145,000, and $245,000, respectively. All are expected to grow at 20 percent per year for four years. The company currently has $19,000,000 in debt and 855,000 shares outstanding. After Year 5, the adjusted cash flow from assets is expected to grow at 3.3 percent indefinitely. The company’s WACC is 9.6 percent and the...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT