Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

The Lifes Good Corporation 2012 income statement shows the following: Income Statement 2012 Sales $ 5,250,000 Costs 2,173,000 Other expenses 67,400 Depreciation expense 179,000 EBIT

The Lifes Good Corporation 2012 income statement shows the following: Income Statement 2012 Sales $ 5,250,000 Costs 2,173,000 Other expenses 67,400 Depreciation expense 179,000 EBIT $ 2,830,600 Interest expense 85,555 EBT $ 2,745,045 Taxes 89,000 Net income $ 2,656,045 Dividends $ 169,000 Addition to retained earnings $ 2,487,045 Lifes Good Corp. also issued $106,700 in new equity during the year and redeemed $65,300 in outstanding long-term debt. i. Calculate the operating cash flow for the firm. (2 marks) $2,920,600 ii. Calculate the cash flow to creditors. (2 marks) $150,855 iii. Calculate the cash flow to stockholders. (2 marks) 62,300 iv. Define free cash flow (FCF) and state one of the equations for computing FCF. (3 marks)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Students also viewed these Finance questions