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Week 1 Homework Problems

# Week 1 Homework Problems - Week 1 Homework Problems Dustin...

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Week 1 Homework Problems Dustin Taylor Chadron State College FIN 631 – Managerial Finance Chapter 2 #10 CFA = CFC + CFS CFA = \$95,000 - \$345,000 = -\$250,000 -\$250,000 = OCF - (-\$85,000) - \$810,000 \$250,000 = -OCF +(-\$85,000) + \$810,000 OCF + \$250,000 = -\$85,000 + \$810,000 OCF = -\$85,000 + \$810,000 - \$250,000 OCF = \$475,000 #15 a. OCF = EBIT + Depreciation – Taxes OCF = \$77,600 + \$13,800 - \$23,520 OCF = \$67,880 b. CFC = Interest – Net new borrowing CFC = \$10,400 - (-\$7,500) CFC = \$17,900 c. CFS = Dividends paid – Net new equity raised CFS = \$12,500 - \$6,000 CFS = \$6,500 d. CFA = OCF – Net capital spending – Change in NWC \$17,900 + \$6,500 = \$67,880 - (\$21,000 + \$13,800) - Change in NWC \$24,400 = \$67,880 - \$34,800 - Change in NWC \$24,400 = \$33,080 - Change in NWC Change in NWC = \$8,680 Chapter 3 #13 a. EFN = (1.0946 x \$6,660,000) - (.1757 x \$6,660,000) - (.1423 x \$43,660,000) x (1 - .3) EFN = \$7,290,000 - \$1,170,000 - \$6,212,700 x .7 EFN = \$1,771,110

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b. Assets Liabilities and equities Current assets \$12,390,000 Short-term debt \$7,670,000 Long-term debt \$7,000,000 Fixed assets \$35,400,000 Common stock \$3,000,000 Accum. Retained earnings \$28,348,890 Total equity \$31,348,890 Total assets \$47,790,000
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