Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

looking for help on this question! thanks for your time (will give review) Assume that you have been asked to estimate the free cash flow

looking for help on this question! thanks for your time (will give review)
image text in transcribed
Assume that you have been asked to estimate the free cash flow to the firm last year for BBC Inc. and have collected the following information The firm reported earnings before interest, taxes, depreciation and amortization of $ 434 million on its revenues of $ 1207 million. Depreciation and amortization charges amounted to $ 183 million and capital expenditures were $ 120 million. - BBCB spent $ 195 milion last year on research and development in its software division and you calculates an amortization for past R&D of $ 121 million The tax rate for the firm is 33 %. The working capital items for the last year (left column) and the previous year (right column) are reported below. Cash $36 million $ 21 million Accounts Receivable $ 51 million $ 50 million Inventory $ 94 million $ 83 million Accounts Payable $ 203 million $ 213 million Estimate the free cash flows to the firm last year. $ 65 million $ 97 million Short term Debt

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Economics For Investment Decision Makers

Authors: Sandeep Singh, Christopher D Piros, Jerald E Pinto

1st Edition

1118111966, 9781118111963

More Books

Students also viewed these Finance questions