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Dmitrij [34]
3 years ago
10

You are considering an investment in fields and struthers, Inc, and want to evaluate the firm's free cash flow From the income s

tatement, you see an EBIT of $90 million, had a tax rate of 21 percent, and its depreciation expense was $10 million. Fields and Struthers's NOPAT gross fixed assets increased by $56 million from 2020 and 2021. The frim's current assets increased by $44 million and spontaneous current liabilities increased by $36 million.
1. Calculate Fields and Struthers's NOPAT operating cash flow for 2021.
2. Calculate Fields and Struthers's NOPAT investment in operating capital for 2021.
3. Calculate Fields and Struthers's NOPAT free cash flow for 2021.
Business
1 answer:
kirill [66]3 years ago
3 0

Answer:

A.) $81,100,000

B.) $64,000,000

C.) $17,100,000

Explanation:

EBIT = $90 million

Tax rate = 21%

Depreciation = $10 million

gross fixed assets increased by $56 million

current assets increased by $44 million

current liabilities increased by $36 million

A.) Operating Cash flow for 2021

EBIT + Depreciation - (EBIT × Tax rate)

$90, 000,000 + 10,000,000 - (90,000,000×0.21)

100,000,000 - (18,900,000) = $81,100,000

B.) Investment in Operating capital for 2021:

Increase in gross fixed asset + (increase in current asset - increase in liability)

$56,000,000 + ( $44,000,000-$36,000,000)

= $56,000,000 + $8,000,000

= $64,000,000

C.) Free cash flow

Operating Cash flow - investment in operating

$81,100,100 - $64,000,000 = $17,100,000

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Answer:

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Explanation:

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The goods whose demand increases in the market when the consumer income rises are known as normal goods.

Thus, the reasoning of the student is confused as the classification of the goods on the basics of normal or inferior depends on response of the demand when there is a change in consumer's income. Thus, the student's own perception about such classification is confused.

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A company’s total monthly sales (in millions of dollars) t months from now are given by:
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Answer:

a) \frac{dS}{dt}=S'(t)= 2(0.5) t +3 = t+3

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c) For this case we have the total sales $ 15 millions after t =4 months

d) S'(4) = 4+3 = 7 million

e) This value represent the increase in the amount of sales in millions after t=4 months

Explanation:

For this case we have the following function for the sales

S(t) = 0.5 t^2 +3t -5

Part a          

For this case we want to find the derivate of S respect to t and we got:

\frac{dS}{dt}=S'(t)= 2(0.5) t +3 = t+3

Part b

For this case we want to find the value of S when t = 4 so if we replace we got:

S(4) = 0.5*(4^2) +3(4) -5=15 million

Part c

For this case we have the total sales $ 15 millions after t =4 months

Part d

For this case we just need to replace t=4 in the derivate and we got:

S'(4) = 4+3 = 7 million

Part e

This value represent the increase in the amount of sales in millions after t=4 months

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