Question

1. The Underground Café has an Operating Cash Flow of $187,000 and a cash flow to creditors of $71,400 for the past year. The firm reduced its net working capital by $28,000 and incurred net capital spending of $47,900. What is the amount of the cash flow to stockholders for the last year?

Answer 1

Given I Operating cash How = $ 187,000 Cash flow to creditors = $71,400 Reduction in net working capital= $ 28,000 Net capital Spending - $ 47,900 . We need to calculate, cash flow to stockholders of Cash flow to stock holder Operating cash flow t Reduction in met working capital - Cash flow to creditors - Net capital spending = $ 187,000+ $18,000 - $ 71,400 – $47,900 12 $ 95,700 So, the cash flow to stockholder is $95,700.