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Ghella [55]
1 year ago
6

free cash flow catering corp. reported free cash flows for 2013 of $8 million and investment in operating capital of $2 million.

catering listed $1 million in depreciation expense and $2 million in taxes on its 2008 income statement. what was catering's 2013 ebit?
Business
1 answer:
arsen [322]1 year ago
4 0

Cash flow accessible Catering Corp. reported $8 million in free cash flows for 2013 and a $2 million investment in operating capital.

What exactly is free cash flow?

In corporate finance, free cash flow or free cash flow to the firm is the amount by which a company's operating cash flow exceeds its demands for working capital and fixed asset expenditures. The cash generated by a company after deducting cash outflows for operating expenses and capital asset upkeep is referred to as free cash flow (FCF).

To learn more about free cash flow

brainly.com/question/28543476

#SPJ4

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Assume that securitization combined with borrowing and irrational exuberance in Hyperville have driven up the value of existing
iVinArrow [24]

Answer:

$120

Explanation:

Given:

• Geometric growth rate of existing financial security:

$4 to $8 to $16 to $32 to $64 to $128

• Arithmetic growth rate of underlying assests:

$4 to $6 to $8 to $10 to $12 to $14

From the values, when the price of the underlying assests is $14, the price of the existing financial security is $128.

We are told to that when values of financial secrities increased from $4 to $128, that of underlying assests also increased from $4 to $14. If patterns hold for decreases as well as for increases. Therefore to get the value of financial securities decline if the value of underlying assests suddenly and unexpectedly fell by $6, we have:

Price of underlying assests when decreased by $6 =

$14-$6 = $8.

Therefore, price of existing financial security decline wil be:

$128-$8 = $120

6 0
3 years ago
Use the following information for Problems 35 through 40 A potential investor is seeking to invest $1,000,000 in a venture, whic
vodka [1.7K]

Answer:

0.3797 or 37.97%

Explanation:

According to the scenario, computation of the given data are as follow:-

Wants Rate on return on investment = 50%

Expected value of return on investment = invested amount × (1+g)^t

= $1,000,000 × (1+50%)^5

= $1,000,000 × 7.59375

= $7,593,750

Similar venture would achieve valuation of $20,000,000 for $2,000,000. We can expect that company would achieve similar valuation of $20,000,000 in 5 years from now.

Investor’s share value at 5 years = $7,593,750 ÷ $20,000,000

= 0.3797 or 37.97%

4 0
3 years ago
Jones Lumber Co. has annual fixed costs including depreciation of $300,000 and variable costs that are 88.25 percent of sales. W
STALIN [3.7K]

Answer:

$2,553,191

Explanation:

The formula to compute the break even point in dollars amount is presented below:

= (Fixed cost ) ÷ (Profit volume ratio)

where,  

Fixed cost = $300,000

And the profit volume ratio would be

= (Contribution margin) ÷ (Sales) × 100

We assume the sales be 100%

So, the variable cost is

= 88.25%

And, the contribution margin is

= 100 - 88.25

= 11.75%

So, the break even sales would be

= $300,000 ÷  11.75%

= $2,553,191

7 0
3 years ago
Should a firm shut down if its weekly revenue is ​$1 comma 000​, its variable cost is ​$600​, and its fixed cost is ​$800​, of w
kifflom [539]

Answer: The correct answer is "C. produce because revenue of ​$1 comma 000 is greater than fixed costs.".

Explanation: The firm should produce because the revenue of 1000 is enough to cover the fixed costs and part of the variables (1000 - 800 - 600 = (-400)) so that the loss is less than if it stopped producing despite the avoidable costs (800 - 350 = 450) since if it stopped producing it would have a loss of $ 450 and producing it would have a loss of $ 400.

7 0
3 years ago
Two roadway designs are under consideration for access to a permanent suspension bridge. Design 1A will cost $1.7 million to bui
Vladimir79 [104]

Answer and Explanation:

A. Given that Design 1A will cost $1.7 million to build and $175,000 per year to maintain

Given that Design 1B will cost $3.6 million to build and $40,000 per year to maintain

Both designs are assumed to be permanent

To find ROR using AW based rate of return equation, we find present value of each design and equate them:

Each design is permanent so

Present value of perpetuity:

Design 1A= 1700000+175000/r

Design 1B = 3600000+40000/r

=1700000+175000/r=3600000+40000/r

135000/r=1900000

Cross multiply

r=135000/1900000

r= 0.0710

r=7.10%

B Given that ROR=7.10% and MARR is 25%

MARR>ROR

Hence we reject both designs

5 0
3 years ago
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