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Financial update as of June 15 . Your existing business generates $123,000 in EBIT. The corporate tax rate applicable to your business is 25%. The
Financial update as of June 15 . Your existing business generates $123,000 in EBIT. The corporate tax rate applicable to your business is 25%. The depreciation expense reported in the financial statements is $23,429. You don't need to spend any money for new equipment in your existing cafs; however, you do need $18,450 of additional cash. You also need to purchase $9,840 in additional supplies--such as tableclothes and napkins, and more formal tableware-on credit . It is also estimated that your accruals, including taxes and wages payable, will increase by $6,150. Based on your evaluation you have in free cash flow. Can a company have negative free cash flow? NO Yes
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