Use the following income statements and balance sheets to calculate Garnet Inc.'s free cash flow for 2011.
Question:
Use the following income statements and balance sheets to calculate Garnet Inc.'s free cash flow for 2011.
GarnetInc.
Free Cash FlowFree cash flow (FCF) represents the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. Unlike earnings or net income, free cash flow is a measure of profitability that excludes the...
Transcribed Image Text:
Income State ment 2011 2010 $500,0 Net sales $530.0 Costs (except depreciation) 400.0 380.0 Depreciation Total operating costs 30.0 25.0 S430.0 $405.0 Earnings before interest and taxes (EBIT) 100.0 95.0 Less interest 23.0 21.0 $ 77.0 $ 74.0 Earnings before taxes Taxes (40%) 30.8 29.6 $ 46.2 S 44.4 Net income Balance Sheet 2011 2010 Assets S 28.0 S 27.0 Cash Marketable securities 69.0 66.0 Accounts receivable 84.0 80.0 Inventories 112.0 106.0 S293.0 S279.0 Total current assets Net plant and equipment 281.0 265.0 Total assets $574.0 $544.0 Liabilities and Equity $ 56.0 $ 52.0 Accounts payable Notes payable 138.0 130.0 Accruals 28.0 $222.0 28.0 $210.0 Total current liabilities Long-term bonds 173.0 164.0 Common stock 100.0 100.0 Retained earnings 79.0 70.0 Common equity Total liabilities and equity S179.0 $170.0 $544.0 $574.0
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 72% (11 reviews)
NOPAT EBIT1T 100104 60 Net operating WC10 27 80 106 ...View the full answer
Answered By
Shem Ongek
I am a professional who has the highest levels of self-motivation. Additionally, I am always angled at ensuring that my clients get the best of the quality work possible within the deadline. Additionally, I write high quality business papers, generate quality feedback with more focus being on the accounting analysis. I additionally have helped various students here in the past with their research papers which made them move from the C grade to an A-grade. You can trust me 100% with your work and for sure I will handle your papers as if it were my assignment. That is the kind of professionalism that I swore to operate within. I think when rating the quality of my work, 98% of the students I work for always come back with more work which therefore makes me to be just the right person to handle your paper.
4.80+
174+ Reviews
426+ Question Solved
Related Book For
Corporate Finance A Focused Approach
ISBN: 978-1439078082
4th Edition
Authors: Michael C. Ehrhardt, Eugene F. Brigham
Question Posted:
Related Video
Accounts payable are money owed by a business to its suppliers shown as a liability on a company\'s balance sheet. It is distinct from notes payable liabilities, which are debts created by formal legal instrument documents
Students also viewed these Corporate Finance questions
-
Following are two years of income statements and balance sheets for the Munich Exports Corporation. A. Calculate the cash build, cash burn, and net cash burn or build for Munich Exports in 2010. B....
-
Following are the income statements and balance sheets of Macy's, Inc. Refer to the financial information above for Macy's, Inc. Prepare a forecast of its financial year 2014 statement of cash flows....
-
On being heated with sulfur trioxide in sulfuric acid, 1, 2, 4, 5-tetramethylbenzene was converted to a product of molecular formula C10H14O3S in 94% yield. Suggest a reasonable structure for this...
-
On October 1, 2018, Farmer Fabrication issued stock options for 100,000 shares to a division manager. The options have an estimated fair value of $6 each. To provide additional incentive for...
-
An angle bracket having thickness t = 0.75 in. is attached to the flange of a column by two 5/8-inch diameter bolts (see figure). A uniformly distributed load from a floor joist acts on the top face...
-
Which of the following is most closely linked to accounting conservatism? a. Materiality concept b. Consistency principle C. Disclosure principle d. Lower-of-cost-or-market rule
-
A gas chromatograph (GC) is a device used to separate the components of a sample of a gas or liquid mixture and to provide a measure of the amount of each component in the sample. The output from a...
-
1. Your firm's account analysis statement for treasury management products and services is shown below. Use this information to determine the following: A) The monthly earnings credit B) The...
-
Match the polar equations with the graphs labeled IIX. Give reasons for your choices. (a) r = cos 3 (b) r = ln , 1 6 (c) r = cos(/2) (d) r = cos(/3) (e) r = sec(/3) (f) r = sec (g) r = 2 , 0 8...
-
How is it possible for an employee stock option
-
EMC Corporation has never paid a dividend. Its current free cash flow of $400,000 is expected to grow at a constant rate of 5%. The weighted average cost of capital is WACC = 12%. Calculate EMCs...
-
Why must a banks assets always equal its liabilities?
-
Pharoah Beverage Company reported the following items in the most recent year. Net income Dividends paid $40,800 5,760 Increase in accounts receivable 13,850 Increase in accounts payable 8,860...
-
During the year, TRC Corporation has the following inventory transactions. Date January 1 Transaction Beginning inventory April 7 Purchase July 16 Purchase October 6 Purchase Number of Unit Total...
-
Draw the velocity - time graph for a person, starting at rest, who moves from 11.0 m to -9.0 m with an acceleration of - 5.0 m/s in 4.0 s.
-
Two rods and one cable are attached to the support at O. If two of the forces are as shown, determine the magnitude and the direction of the third force F so that the resultant of the three forces is...
-
Lets assume that we have project L, which has a 40% chance of turning out good. The company Raises $7,000, 50% from bondholders demanding a 6% interest rate and 50% from stockholders, which becomes...
-
How is a volcano like a shaken bottle of soda?
-
Inexhaustible collections of ONPOs are not required to be capitalized or depreciated, if certain criteria are met. Why is this so, and what accounting and reporting recognition, if any, is required...
-
How many subshells are in the n = 3 shell? Identify each subshell, calculate the maximum number of electrons that will fit into each, and verify that the total is 2n 2 . Strategy Subshells are...
-
Johnson Industries is considering an expansion project. The necessary equipment could be purchased for $9 million, and the project would also require an initial $3 million investment in net operating...
-
Carter Air Lines is now in the terminal year of a project. The equipment originally cost $20 million, of which 80 percent has been depreciated. Carter can sell the used equipment today to another...
-
The Campbell Company is evaluating the proposed acquisition of a new milling machine. The machines base price is $108,000, and it would cost another $12,500 to modify it for special use by your firm....
-
Suppose that you own the only company in the market to produce a certain product, and therefore you can determine the market price P dollars for each unit. Due to government regulations, the price of...
-
Glitz hotel is going to make a $2,000,000 investment by completing renovating a floor of the hotel.The floorplan will be entirely redone, and they can have a mix of three types of rooms: Luxury...
-
Let be a function that satisfies the following properties: f(x+y)= f(x)f(y) for all r. y R, and f'(0) = 1. a. Explain why f is continuous at x=0. b. Show the following two facts: that f(0) = 1, and...
Study smarter with the SolutionInn App