ssignment iYou are considering an investment in Fields and Struthers, Incorporated, and want to evaluate the firm's free cash flow. From theincome statement, you see that Fields and Struthers earned an EBIT of $62 million, had a tax rate of 21 percent, and its depreciationexpense was $5 million. Fields and Struthers's gross fixed assets increased by $32 million from last year to this year. The firm's currentassets increased by $20 million and spontaneous current liabilities increased by $12 million.Calculate Fields and Struthers's NOPAT.Note: Enter your answer in millions of dollars rounded to 2 decimal places. (i.e., Enter 5,500,000 as 5.50.)NOPATOperating cash flow43.4 millionCalculate Fields and Struthers's operating cash flow.Note: Enter your answer in millions of dollars rounded to 2 decimal places. (i.e., Enter 5,500,000 as 5.50.)Investment in operating capitalSavedmillionCalculate Fields and Struthers's investment in operating capital.Note: Enter your answer in millions of dollars. (i.e., Enter 10,000,000 as 10.)million< PrevN5 of 10Next >

NOPAT - It is a financial measure which is used to determine the profitability of an entity after…

Answered: You are considering an investment in…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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You have looked at the current financial statements for J&R Homes, Company. The company has an EBIT of $5,250,000 this year. Depreciation, the increase in net working capital, and capital spending were $345,000, $175,000, and $595,000, respectively. You expect that over the next five years, EBIT will grow at 15 percent per year, depreciation and capital spending will grow at 20 per year, and NWC will grow at 10 per year. The company has $29,500,000 in debt and 500,000 shares outstanding. After Year 5, the adjusted cash flow from assets is expected to grow at 3.3 percent, indefinitely. The company's WACC is 9.45 percent and the tax rate is 25 percent. What is the price per share of the company's stock? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Share price
You have been studying Lucas Corp.’s financial statements. This year, the company has an EBIT of $3.15mil, Depreciation of $295,000, an increase in net working capital of $125,000, and a capital spending of $535,000. You expect that over the next 5 years, EBIT will grow at 15% per year, depreciation and capital spending will grow at 20% per year, and NWC will grow at 10% per year. After year 5, you expect the company’s free cash flow will grow at 3.5% indefinitely. The company has a 21% corporate tax rate and a WACC of 8.9%. a) Compute the free cash flows for the next 5 years. b) Compute the terminal value at the end of year 5. c) What is the company’s enterprise value?
You are considering an investment in Fields and Struthers, Inc., and want to evaluate the firm's free cash flow. From the income statement, you see that Fields and Struthers earned an EBIT of $70 million, had a tax rate of 21 percent, and its depreciation expense was $7 million. Fields and Struthers's NOPAT gross fixed assets increased by $36 million from 2020 and 2021. The firm's current assets increased by $32 million and spontaneous current liabilities increased by $18 million. Calculate Fields and Struthers's NOPAT operating cash flow for 2021. Calculate Fields and Struthers's NOPAT investment in operating capital for 2021. Calculate Fields and Struthers's NOPAT free cash flow for 2021.
For 2022, You're Doing Great Corporation reported $22 million in sales and $19 million In operating costs Cincluding depreciation). The company has $15 million of total invested capital. Its after-tax cost of Capital is 10%, and its tax rate is 25%. What was the firm's economic value added (EVA) during 2022?
You have looked at the current financial statements for J&R Homes, Company. The company has an EBIT of $2,890,000 this year. Depreciation, the increase in net working capital, and capital spending were $227,000, $92,000, and $425,000, respectively. You expect that over the next five years, EBIT will grow at 18 percent per year, depreciation and capital spending will grow at 23 percent per year, and NWC will grow at 13 percent per year. The company currently has $15.5 million in debt and 415,000 shares outstanding. After Year 5, the adjusted cash flow from assets is expected to grow at 3.5 percent indefinitely. The company's WACC is 8.9 percent and the tax rate is 23 percent. What is the price per share of the company's stock? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Share price
You invested in RYURX and RYIHX which each had a loss on the year. RYURX had a year-to-date loss of 5% while RYIHX had a year-to-date loss of 7%. If you invested a total of $15,500 and had a total year-to-date loss of $915, how much did you invest in each company?
You are considering an investment in Fields and Struthers, Inc., and want to evaluate the firm's free cash flow. From the income statement, you see that Fields and Struthers earned an EBIT of $64 million, had a tax rate of 21 percent, and its depreciation expense was $5 million. Fields and Struthers's NOPAT gross fixed assets increased by $30 million from 2020 and 2021. The firm's current assets increased by $26 million and spontaneous current liabilities increased by $15 million. Calculate Fields and Struthers's NOPAT operating cash flow for 2021. (Enter your answer in millions of dollars rounded to 2 decimal places.) Operating cash flow Calculate Fields and Struthers's NOPAT investment in operating capital for 2021. (Enter your answer in millions of dollars.) Investment in operating capital million Free cash flow Check my work million million Calculate Fields and Struthers's NOPAT free cash flow for 2021. (Enter your answer in millions of dollars rounded to 2 decimal places.)
ok You are considering an investment in Fields and Struthers, Incorporated, and want to evaluate the firm's free cash flow From the income statement, you see that Fields and Struthers earned an EBIT of $66 million, had a tax rate of 21 percent, and its depreciation expense was $5 million. Fields and Struthers's gross fixed assets increased by $32 million from last year to this year. The firm's current assets increased by $28 million and spontaneous current liabilities increased by $16 million. Calculate Fields and Struthers's NOPAT Note: Enter your answer in millions of dollars rounded to 2 decimal places. (i.e., Enter 5,500,000 as 5.50.) NOPAT Calculate Fields and Struthers's operating cash flow Note: Enter your answer in millions of dollars rounded to 2 decimal places. (i.e., Enter 5,500,000 as 5.50.) Operating cash flow Investment in operating capital million Calculate Fields and Struthers's investment in operating capital. Note: Enter your answer in millions of dollars. (i.e.,…
Vasudevan Inc. recently reported operating income of $5.90 million, depreciation of $0.80 million, and had a tax rate of 25%. The firm's expenditures on fixed assets and net operating working capital totaled $0.60 million. How much was its free cash flow, in millions?
DataDyne Company reported EBIT of $590 million for the most recent fiscal year. Interest expense were $10 million and the current tax rate was 20%. The firm had depreciation expenses of $100 million and capital expenditures of $150 million. In addition, the firm did have a decrease in net working capital of $30 million. What is DataDyne's free cash flow?
The Dog House has sales of $502,000, and depreciation of $47,000. The firm is entirely equity-financed and has a profit margin of 5% and tax rate of 35%. What is the amount of the operating cash flow?
As a financial analyst, you have been tasked with evaluating Randy Watson Music's free cash flow. Based on the 2022 income statement, EBIT was $41 million, the tax rate was 21 percent, and its depreciation expense was $6 million. NOPAT gross fixed assets increased by $28 million from 2021 and 2022. The company's current assets increased by $18 million and current liabilities increased by $14 million. Calculate the operating cash flow (OCF) for 2022. (Enter your answer in millions of dollars.)

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