Calculating Total Cash Flows [ LO4] Nightwish Corp. shows the following information on its 2021 income statement: Sal = $336,000; Costs = $194,700; Other expenses = $9,800; Depreciation expense = $20,600; Interest expense = $14,20 Taxes = $21,275; Dividends = $21,450. In addition, you're told that the firm issued $7,100 in new equity during 2021 ar redeemed $5,400 in outstanding long-term debt. a. What is the 2021 operating cash flow? b. What is the 2021 cash flow to creditors? c. What is the 2021 cash flow to stockholders?
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- 59) During the coming year, Gold & Gold wants to increase its free cash flow by $180 million, which should result in a higher stock price. The CFO has made these projections for the upcoming year: ∙ EBIT is projected to equal $852 million. ∙ Gross capital expenditures are expected to total to $360 million versus depreciation of $120 million, so its net capital expenditures should total $240 million. ∙ The tax rate is 25%. ∙ There will be no changes in cash or marketable securities, nor will there be any changes in notes payable or accruals. What increase in net working capital (in millions of dollars) would enable the firm to meet its target increase in FCF? a. $379 b. $219 c. $263 d. $316 e. $175 63) If D 1 = $1.50, g (which is constant) = 6.5%, and P 0 = $56, what is the stock's expected capital gains yield for the coming year? a. 6.50% b. 7.52% c. 7.90% d. 7.17% e. 6.83% 64) Shulman…55 Ron Enterprises forecasts the free cash flows (in millions) shown below. The weighted average cost of capital is 13.0%, and the FCFs are expected to continue growing at a 5.0% rate after Year 3. What is the firm’s total corporate value, in millions? Year 1 2 3 FCF -P15.0 P10.0 P40.0 Group of answer choices P348.48 P331.06 P386.13 P366.82 P314.5165.) Suppose Buyson Corporation’s projected free cash flow for next year is FCF1 = P150,000, and FCF is expected to grow at a constant rate of 6.5%. If the company’s weighted average cost of capital is 11.5%, what is the firm’s total corporate value?Group of answer choices P3,150,000 P2,572,125P2,707,500 P2,850,000 P3,000,000
- 9 Kale Inc. forecasts the free cash flows to the firm (in millions) shown below. If the weighted average cost of capital is 11.0%, cost of equity is 16%, and FCF to the Firm is expected to grow at a rate of 5.0% after Year 2, what is the firm’s total corporate value, in millions?. Year 1 2 Free cash flow -P30 P130 Group of answer choices P1,686 P1,770 P1,925 P1837 P993 P1,456 P1,529 P1,606Ryan Enterprises forecasts the free cash flows (in millions) shown below. Assume the firm has zero non-operating assets. The weighted average cost of capital is 13.0%, and the FCFs are expected to continue growing at a 6.0% rate after Year 3. What is the firm’s total corporate value (in millions)? Do not round intermediate calculations. Year 1 2 3 FCF -$30.0 $10.0 $50.0 a. $510.97 million b. $610.96 million c. $506.02 million d. $540.67 million e. $573.18 million25 - For 2023, Volant Inc. is forecast to have Free Cash Flow to the Firm of $1.7 million and Free Cash Flow to Common Equity of $1.3 million. You forecast Free Cash Flow to the Firm to grow at a constant rate of 3.50% while Free Cash Flow to Common Equity grows at 4.00%. Volant’s tax rate is forecast to be 25%. You also collect the data shown below. Book Value Market Value Debt $14.5 million $15.0 million YTM: 4.24% Common Equity $21.0 million $45.0 million Rate of Return: 7.00% Calculate Volant’s Weighted Average Cost of Capital and round to 1 basis point. WACC:
- Kale Inc. forecasts the free cash flows (in millions) shown below. Assume the firm has zero non-operating assets. If the weighted average cost of capital is 11.0% and FCF is expected to grow at a rate of 5.0% after Year 2, then what is the firm’s total corporate value (in millions)? Do not round intermediate calculations. Year 1 2 Free Cash flow -$50 $115 a. $1,295 b. $1,682 c. $1,833 d. $1,530 e. $1,446Assume that today is December 31, 2021. Use the following information that applies to Harrison Corporation to calculate what should be the company’s stock price today. After-tax operating income [EBIT (1 – T)] for 2022 is expected to be $850 million The depreciation expense for 2022 is expected to be $110 million The capital expenditures for 2022 are expected to be $650 million No change is expected in net working capital The free cash flow is expected to grow at a constant rate of 5.5% per year The required return on equity is 10% The WACC is 8% The firm has $150 million of non-operating assets The market value of the company’s debt is $3.25 billion 250 million shares of stock are outstanding Using the corporate valuation model approach, what should be the company’s stock price today?CASE 3 Pinocchio Inc. has a total annual cash requirement of P9,075,000 which are to be paid uniformly. Simile has the opportunity to invest the money at 24% per annum. The company spends, on the average, P40 for every cash conversion to marketable securities. Required: Please solve 4-7 4. How much is the total holding cost? 5. How much is the total transaction cost? 6. How much is the total cost of cash? 7. What will be your advice to the management?
- Q5. ABC Corporation has 9million in inventory and 8m in accounts receivable. A 20% reduction ininventories and accounts receivable is proposed. Sales would reduce by 10%, while the payables deferralperiod would remain at 35 days. A company has annual sales of 3.65m. The CGS is 75% of sales. Findthe effect of the changes on the cash conversion cycle?Your company has expected future cash flows of $70 million in perpetuity. The company's WACC is 12.8%. The company has $337 million in debt, and $188 million in excess cash, and 12 million shares. What is the share price of the company?Kale Inc. forecasts the free cash flows (in millions) shown below. Assume the firm has zero non-operating assets. If the weighted average cost of capital is 11.0% and FCF is expected to grow at a rate of 5.0% after Year 2, then what is the firm’s total corporate value (in millions)? Do not round intermediate calculations. Year 1 2 Free Cash flow -$30 $195 a. $3,413 million b. $2,901 million c. $3,044 million d. $2,743 million e. $2,643 million