Question
Sweeter Enterprises Inc. has cash flows from operating activities of $438,000. Cash flows used for investments in property, plant, and equipment totaled $92,000, of which
Sweeter Enterprises Inc. has cash flows from operating activities of $438,000. Cash flows used for investments in property, plant, and equipment totaled $92,000, of which 70% of this investment was used to replace existing capacity. a. Determine the free cash flow for Sweeter Enterprises Inc. $ b. How might a lender use free cash flow to determine whether or not to give Sweeter Enterprises Inc. a loan? Free cash flow is often used to measure the financial strength of a business. The free cash flow that a business has, the easier it will be for the company to pay the interest on the loan and repay the loan principal. Sweeters free cash flow is $ , which is very .
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started