1. (10 Points) Use the following information to calculate:
   1. Free Cash Flow
   2. Uses of Free Cash Flow

Bo Knows Profit Corporation

Income Statement for Year Ending 2015

Sales	$4,400
Less: Costs	2,800
Depreciation	450
EBIT	1,150
Less: Interest	175
EBT	975
	390
Net Income	$585
Dividends	200
Addition to Retained Earnings	385

Bo Knows Profit Corporation

Balance Sheets for End of Years 2014, 2015

	2014	2015		2014	2015
Cash	170	100	Accounts Payable	135	120
Accounts Receivable	500	700	Notes Payable	1,200	1,400
Inventory	1,240	1,000	Current Liabilities	1,335	1,520
Current Assets	1,910	1,800	Long-term Debt	2,005	2,620
Fixed Assets	2,000	3,395	Common Stock	100	200
			(50 shares)
			Retained Earnings	470	855
Total Assets	3,910	5,195	Total Liab. & Equity	3,910	5,195