different. But what we call mad money, they call free cash flow. Free cash flow is the remaining cash flows that are available for use by a company to bring added wealth and value to the shareholders after all the bills have been paid. It represents real cash. The presence of free cash flow indicates that a company has cash to expand, develop new products, buy back stock, pay dividends, or reduce its debt. High or rising free cash flow is often a sign of a healthy company that is thriving in
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Accounting for Business Decision Making Assignment Ali Nafiz S1409011055 Submitted on 9th November, 2014 Table of Contents Task 1 Task 2 Task 3 2-4 5-7 8-10 1 Ali Nafiz S1409011055 TASK 1 a) Anhad Sdn. Bhd. Budgeted statement of profit for the year ending 31 October 2014 RM (000s) Revenue (120000 × 8)1 Less Variable overheads Direct Materials (1200 × 2) × 95%2 Direct Labour (1200 × 1.32)3 Production overheads Selling overheads Distribution overheads Contribution Less Fixed overheads7
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analysis techniques. The first section of the test addresses discounted cash flow analysis. See how you would do by answering the following questions. a. Draw time lines for (a) a $100 lump sum cash flow at the end of year 2, (b) an ordinary annuity of $100 per year for 3 years, and (c) an uneven cash flow stream of -$50, $100, $75, and $50 at the end of years 0 through 3. Answer: (Begin by discussing basic discounted cash flow concepts, terminology, and solution methods.) A time line is
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capital of the firm, use the WACC to discount the operating cash flows adjusted for inflation and earned in the next 6 years, add the tax shield given by the depreciation minus the initial investment (since the case doesn’t any CCA rate, we calculate tax shield both with the CCA rate 45% which is checked through internet and without the CCA rate), minus the initial investment 9,000,000, for each scenario (the original operating cash flow 2.5 million, 30% higher and 15% lower). First, the nominal
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FINANCIAL MANAGEMENT AND POLICIES FIRST YEAR REQUIRED COURSE PACKET Quarter III, Spring 2010 FACULTY Section I: Section II: Section III: SectionIV: Section V: FINANCIAL MANAGEMENT AND POLICIES Quarter III, Spring 2010 Elena Loutskina Marc Lipson Robert Conroy MarcLipson Elena Loutskina IMPORTANT SCHEDULE ANNOUNCEMENT: Thursday, February 19 is a DAY LONG exercise that requires your participation until 5:30pm that evening. By compressing the exercise into a single day we were able to designate
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Chapter 18: Chapter 19: Chapter 20: Chapter 21: Chapter 22: Chapter 23: Chapter 24: Chapter 25: Chapter 26: Chapter 27: Chapter 28: Chapter 29: Chapter 30: Chapter 31: Answers to End-of-Chapter Problems Accounting Statements and Cash Flow ................................................................... Financial Planning and Growth ............................................................................... Net Present Value ...............................................
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TO: Lecturer FROM: Student RE: Mercury Athletic Footwear Acquisition Net Present Value of Mercury Athletic Enterprise The results of my financial analysis based on the Free Cash Flow Method considering the base case of financial projections and assumptions for Mercury Athletic Footwear collated and developed by John Liedtke indicate that that the project to acquire Mercury Althletic has a positive net present value at $243,025 (in thousands) [ given by PV(FCF)=86,681+ PV (Terminal Value) =156
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(assuming 64 checks average 200.00 baht) -Project life is six years with a sales growth of 6% per annum -Zero salvage value for depreciation using the straight line method -10,000.00 baht is charged for common area maintenance fees PBH will use cash on hand for the capital improvements and so based on the interest rates on their deposits at Siam Commercial Bank the
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planning and managing of a firms investment in non-current assets. The main thing is the cash flow. Evaluating; * Size of future cash flows * Timing of future cash flows * Risk to future cash flows. Cash flow timing is when a dollar today is worth more than a dollar at some future date. There is a trade-off between the size(amount) of an investements cash flow, and when the cash flow is recieved. So a dollar today, is more worth than a dollar a yeat from now. * The
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Solutions to Assigned Problems Chapter One 2. Example One: An individual opens a savings account at a local commercial bank with a $200 deposit. The bank loans out the $200 with other funds from other savings accounts to a local business man who is expanding his business. The local business man pays back the loan overtime with interest and the bank credits the savings account with interest. The individual withdraws money from the savings account to buy a new bike. Example Two: An individual
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