Analysts project the FIN340 Company's upcoming 5 years of (undiscounted) cash flow is as follows: Projected (Undiscounted) Future Cash Flows Year 1 Year 2 Year 3 Year 4 Year 5 $3,900,000 $4,056,000 $4,218,240 $4,386,970 $4,562,449 Other key assumptions regarding the FIN340 Company are provided below: • The annual cash flow growth rate assumed in the above projections is 4.0%/year. • The FIN340 Company's terminal value (value of all cash flows in year 6 & beyond) is projected at 2.0 times the discounted value of Year 5 cash flow. The discount rate (required rate of return) for the FIN340 Company is 8.0%. The FIN340 Company has 1,100,000 shares outstanding. The company carries no debt and is fully financed with equity.

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Cash Flow Statement Analysis

A company's cash flow is the movement of its cash inflows and cash outflows. A cash flow statement is prepared to determine changes in an organization's cash position. A cash flow statement shows how much money was generated and spent on the business during the fiscal year. The cash flow analysis is a method of analyzing an organization's investing, financing, and operating activities. A cash flow statement reveals an organization's liquidity and solvency, as well as its ability to change cash flows in the future. It eliminates the other effects of accounting methods by improving the comparability of different organizations' operational performance.