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Greener Side Fertilizer, Inc. estimates that its total financing needs for the coming year will be $35 million. The firm's required financing payments on its
Greener Side Fertilizer, Inc. estimates that its total financing needs for the coming year will be $35 million. The firm's required financing payments on its debt and equity financing during the coming fiscal year will total $15 million. The firm's financial manager estimates that operating cash flows (OCFs) for the coming year will total $30.1 million and that the following changes will occur in the accounts noted.
Account | Forecast change |
Gross fixed assets | +$5 million |
Change in current assets | +$3 million |
Change in accounts payable | +$2 million |
Change in accrued liabilities | +$0.6 million |
a. | Estimate Greener Side's free cash flow (FCF) for the coming year. |
b. | How much of the free cash flow will the firm have available as a source of new internal financing in the coming year? |
c. | How much external financing will Greener Side need during the coming year to meet its total forecast financing needs? |
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