QUESTION 3: (a) The following financial information is from the reformatted financial statements of UE Limited. 20194 120 UE Limited (NZD m) Net Operating Profit After taxe Net Non-operating Expenses (net of taxes) Clean Surplus Profite 2018 100+ 564 95 114 1,000+ 600 400 9504 5756 3756 Net Operating Assets Net Non-operating Obligations Common Share Equity Net Cash Flow from Operations Net Cash Flow re-invested into the Operations Net Cash Flow invested into Non-operating assets (excl. Cash at Bank) Net Cash Flow distributed to Shareholders Net Cash Flow distributed to Debtholders (net of taxes) Change in Cash at Bank 150 80 14566 856 704 89 7 -26 -166 REQUIRED: (i) Calculate the 2019 Free Cash Flow for the Firm based on the generation of cash. Briefly explain the inputs and output of this calculation. (2 marks) (ii) Calculate the 2019 Free Cash Flow for the Firm based on the parsimonious method. Briefly explain the inputs and output of this calculation. (2 marks) (iii) Calculate the 2019 Free Cash Flow for the Firm based on the distribution of cash. Briefly explain the inputs and output of this calculation. (2 marks QUESTION 3: (a) The following financial information is from the reformatted financial statements of UE Limited. 20194 120 UE Limited (NZD m) Net Operating Profit After taxe Net Non-operating Expenses (net of taxes) Clean Surplus Profite 2018 100+ 564 95 114 1,000+ 600 400 9504 5756 3756 Net Operating Assets Net Non-operating Obligations Common Share Equity Net Cash Flow from Operations Net Cash Flow re-invested into the Operations Net Cash Flow invested into Non-operating assets (excl. Cash at Bank) Net Cash Flow distributed to Shareholders Net Cash Flow distributed to Debtholders (net of taxes) Change in Cash at Bank 150 80 14566 856 704 89 7 -26 -166 REQUIRED: (i) Calculate the 2019 Free Cash Flow for the Firm based on the generation of cash. Briefly explain the inputs and output of this calculation. (2 marks) (ii) Calculate the 2019 Free Cash Flow for the Firm based on the parsimonious method. Briefly explain the inputs and output of this calculation. (2 marks) (iii) Calculate the 2019 Free Cash Flow for the Firm based on the distribution of cash. Briefly explain the inputs and output of this calculation. (2 marks
