Consider the following financial information and answer the questions that follow: Sales : $250,000 Costs : $134,000 Depreciation : $10,200 Operating expenses : $6,000 Interest expenses : $20,700 Taxes : $18,420 Dividends : $10,600 Addition to Retained Earnings : $50,080 Long term debt repaid : $9,300 New Equity issued : $8,470 New fixed assets acquired : $15,000 You are required to: i) Calculate the operating cash flow  ii) Calculate the cash flow to creditors  iii) Calculate the cash flow to shareholders

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Consider the following financial information and answer the questions
that follow:
Sales : $250,000
Costs : $134,000
Depreciation : $10,200
Operating expenses : $6,000
Interest expenses : $20,700
Taxes : $18,420
Dividends : $10,600
Addition to Retained Earnings : $50,080
Long term debt repaid : $9,300
New Equity issued : $8,470
New fixed assets acquired : $15,000
You are required to:
i) Calculate the operating cash flow 
ii) Calculate the cash flow to creditors 
iii) Calculate the cash flow to shareholders 
iv) Calculate the cash flow from assets 
v) Calculate net capital spending 
vi) Calculate change in NWC

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Follow-up Question

The following financial information is available for Hero Sports Ltd.:
Sales : $45,000
Costs : $25,000
Addition to retained earnings : $5,500
Dividends paid : $900
Interest expense : $1,450
Tax rate : 40%
Compute the depreciation expense.

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Follow-up Question

iv) Calculate the cash flow from assets 
v) Calculate net capital spending 
vi) Calculate change in NWC

 

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Follow-up Question

for the cash flow to shareholders wouldnt the addition to retain earning be included?

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