Suppose you are the only owner of a chain of coffee shops near universities. Your current cafs are doing well, but you are interested in starting a fine-dining restaurant. You decide to use the cash generated from your existing business to enter into a new business. Your accountant provides you with the following data on your current financial performance:

Financial update as of June 15

	Your existing business generates $111,000 in EBIT.
	The corporate tax rate applicable to your business is 25%.
	The depreciation expense reported in the financial statements is $21,143.
	You dont need to spend any money for new equipment in your existing cafs; however, you do need $16,650 of additional cash.
	You also need to purchase $8,880 in additional suppliessuch as tableclothes and napkins, and more formal tablewareon credit.
	It is also estimated that your accruals, including taxes and wages payable, will increase by $5,550.

Based on your evaluation you have FILL IN in free cash flow.

Can a company have negative free cash flow? ANSWER

Yes

No