You must type in both the answer and all of your work to receive credit.Use the financial statements and additional data provided by management to calculate the firm's Free Cash Flow for the projected year.• Tax rate = 25%• Plans for the projected year will require $500 of new machinery and equipment• Firm expects next year's dividend to be $260Acme Products, Inc.Balance SheetsASSETSCashReceivablesInventoryProperty, plant &equipmentTotal assetsLIABILITIES & EQUITYAccounts payablesAccrued expensesLong-term debtCommon stockPaid-in CapitalRetained earningsTotal liabilities andequitycurrent yr4006009002,2004,1005004001,4006002001,0004,100projectedyr5007501,1252,750Acme Products, Inc.Income StatementOperatingexpenses5,125 Depreciation5,125Sales (all credit)Cost of GoodsSoldGross ProfitOperating incomeInterest expense625 Taxable income500Taxes (25%)1,750Net income7502501,250projectedyr7,0004,0003,0001,4004001,2001001,100275825

Operating income=1200Taxes=275Capital expenses=$500Depreciation=400

You must type in both the answer and all of your work to receive credit. Use the financial statements and additional data provided by management to calculate the firm's Free Cash Flo • Tax rate = 25% • Plans for the projected year will require $500 of new machinery and equipment • Firm expects next year's dividend to be $260 Acme Products, Inc. Balance Sheets ASSETS Cash Receivables Inventory current yr 400 600 900 projected yr 500 Acme Products, Inc. Sales (all credit) Cost of Goods Sold 1,125 Gross Profit 750 Income Statement projected yr 7,000 4,000 3,000

You must type in both the answer and all of your work to receive credit. Use the financial statements and additional data provided by management to calculate the firm's Free Cash Flo • Tax rate = 25% • Plans for the projected year will require $500 of new machinery and equipment • Firm expects next year's dividend to be $260 Acme Products, Inc. Balance Sheets ASSETS Cash Receivables Inventory current yr 400 600 900 projected yr 500 Acme Products, Inc. Sales (all credit) Cost of Goods Sold 1,125 Gross Profit 750 Income Statement projected yr 7,000 4,000 3,000

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter6: Managing Cash Flow

Section: Chapter Questions

Problem 13SEP

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