Financial Management Help?

G

Gina B

New member
I can't figure it out please help!

Bedrock Gravel Corp. shows the following information on its 2007 income statement: sales = $162,000; costs = $93,000; other expenses = $5,100; depreciation expense = $8,400; interest expense = $16,500; taxes = $14,820; dividends = $9,400. In addition, you're told that the firm issued $7,350 in new equity during 2007 and redeemed $6,400 in outstanding long-term debt.

a. The 2007 operating cash flow is $____________.
d. If net fixed assets increased by $12,000 during the year, the addition to NWC is $____________.
 
INCOME....................$162,000

EXPENSES
Cost of Goods Sold...............$93,000
Other expense......................$ 5,100
Depreciation.........................$ 8,400
Interest Paid.........................$16,500
Taxes........................... $14,820
Dividends Paid Out................$ 9,400
TOTAL EXPENSE.................$147,220
NET INCOME...........................$14,780

Operating cash flow is calculated by a relatively simple equation:EBIT (earnings before interest and taxes)+ Depreciation- Taxes. EBIT is also known as operating income.

EBIT : $54,500
+ Depreciation: $8,400
- Tax: ($14,820)
Op Cash Flow: $48,080

NWC = Current Assets - Current Liabilities. I am not sure if the fixed assets are considered current assets. If they are, then NWC increased by $12,000.
 
Back
Top