Question

How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.

Answer 1

Answer: See explanation

Explanation:

You didn't give a complete question as there are no figures attached but I saw a question online which I think is the complete question. Below are the answers:

1. After tax interest in 2010

= (1 - t) × Interest

= (1 - 40%) × 120,000,000

= (1 - 0.4) × 120,000,000

= 0.6 × 120,000,000

= $72,000,000

After tax interest in 2009

= (1 - t) × Interest

= (1 - 40%) × 100,000,000

= (1 - 0.4) × 100,000,000

= 0.6 × 100,000,000

= $60,000,000

2. Net debt repayment in 2010

= (1,000,000,000 + 200,000,000) - (1,100,000,000 + 384,000,000)

= 1,200,000,000 - 1,484,000,000

= -284,000,000.

3. The RCF used for common dividend in 2009 = $200,000,000

The RCF used for common dividend in 2009 = $220,000,000

4. Net stock repurchase 2010

= $110,000,000 - $100,000,000

= $10,000,000