RULES FOR ESTIMATING CASH FLOWS (1) - FCF = NOPAT – NET...

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RULES FOR ESTIMATING CASH FLOWS! EBIT = (R-O-D) NOPAT = (R-O-D) (1-t) OCF = (R-O-D) (1-t) + D ______________________________________________ Assuming no CAPEX: FCF = OCF – change in NWC With CAPEX: FCF = OCF – GROSS INVESTMENT where gross investment = change in NWC + change in GROSS fixed assets
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Unformatted text preview: FCF = NOPAT – NET INVESTMENT where NET investment = change in NWC + change in NET fixed assets CBS EXAMPLE Net investment = change in NWC + change in Net FA = 75 + 230 = 305 Gross investment = change in NWC + change in Gross FA = 75 + 330 = 405...
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