13. Net cash flow How much cash does the firm actually have? You are the CFO of ABC Corp. You are looking to hire a financial analyst, and you've given an assignment to two short-listed candidates. You've given the following information to the job applicants: The company reported net sales of $43,750,000. Assume that there were no noncash sales. Operating costs (excluding depreciation and amortization) were 65% of the company's total revenues. Depreciation and amortization charges were 5% of total sales. Interest charges were 15% of earnings before interest and taxes (EBIT) with a tax rate of 40%. You've asked the candidates to give you a number that best represents the cash flow situation of the company. FINN: submits a report stating that the firm has $8,881,250 in cash. ARTY: submits a report stating that the firm has $6,693,750 in cash. Based on the information given to them, which applicant has provided a better estimate of the company's current cash flows? Check all that apply. o Arty Finn Your follow-up question to both Finn and Arty asks them to think about the difference between their cash flow estimates. The most likely reason for the discrepancy is that failed to: Subtract the company's depreciation and amortization expenses from ABC's EBIT. Add back the company's non-cash expenses to ABC's net income