Question

Help finding the free cash flow to equity and free cash flow to firm!

Balance Sheet

Assets Cash Accounts Receivable Inventories Total Current Assets 2008 55,528 $ 632,160 1,287,360 1,975,048 2007 57,600 375,00

Income Statement:

ABC Company Income Statement For Year Ended 12/31/2018 6,834,400 5,728,000 1,106,400 Sales Cost of Goods Sold Gross Profit Op

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Answer #1

Free Cash Flow to Equity (FCFE) = Net Income - (Capital Expenditures - Depreciation) - (Change in Non-cash Working Capital) + (New Debt Issued - Debt Repayments)

=98,010-(5,000-86,250)-(12,28,470)+(1,50,000)

=-889,210

​FCFF=NI+NC+(I×(1−TR))−LI−IWC

where:NI=Net income

NC=Non-cash charges

I=Interest

TR=Tax Rate

LI=Long-term Investments

IWC=Investments in Working Capital​

Simply,put everything in the formula and you'll be done

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