Cash Flow – Cash Flow Notes

Victoria Jones asked:


cash flow from operating activities- $175,000
cash flow from financing activities- 75,000
cash flow from investing activities- 25,000
interest- 10,000
taxes-8,000
capital expenditures- 15,000
average amount of debt maturing over the next five years- 150,000

what is the cash flow adequacy ratio? round your answer to three decimals

A. 0.500
B. 0.947
C. 1.056
D. 1.613

i picked D, is that correct?

Geoffrey Eckles

Billy asked:


You are presented with a complimentary business to buy (merge into your company).
After considering excess costs, initial duplication then cost savings, and taxes, the following net cash flows are to be realized
once the transaction is completed. (These are the true incremental numbers for the acquisition).

all numbers in ’000′s
Year12345
Cash Flow Growth over previous years
$1,500 33.3%50.0%66.7%growth of 5% each year after yr 4

All cash flows are after tax and occur at the end of the year only, with the purchase price being paid at the end of year “0″.
Assume your company’s beta will be 1.50 after the merger (that is, considering these new cash flows).
Assume your post acquisition tax rate to be 40%; the risk free rate to be 6%.
Assume the market risk premium is 4%.

Hints:
This problem requires the use of several math formulas used throughout the term and Finance 3331.
Some of these formulas might include:
Time Value of Money
WACC
CAPM
Constant Growth Model / non-constant growth dividend valuation model
Corporate Valuation Model
ROE (part of the Dupont Models)
Black Scholes Option pricing models
Purchase Price Parity

Suggestions
#1From the data provided, determine your required return.
#2Determine the cash flows for years 2 thru infinity.
#3Tackle the problem backwards
#4You might want to re-visit chapter 9 and the constant growth model (years 5 thru infinity)

Phyliss Cratch

Dirk asked:


our teacher has been piling it on pretty thick and I had to do like 150 of these but I keep getting these ones wrong.

For each of the transactions, identify:

If the transaction is a cash inflow (CI), or a cash outflow (CO), or a non cash flow transaction (NT).

And also identify Each transaction as an operating activity (OA), an investing activity (IA), or a financing activity (FA), or a non cash flow transaction (NT).
For example, payments to employees would be (CO) and (OA).

Proceeds from issuance of debt.
Payments for taxes.
Purchase of short-term investments.
Collections of dividends.
Payment of long-term debt.
Proceeds from sale of fixed assets (plant and equipment).
Payments to suppliers of goods and services.
Proceeds from sales of short-term investments.
Declaration of a stock split.
Collections from customers.
Payment of cash dividends.
Proceeds from issuance of common or preferred stock.
Payments to employees.
Purchases of fixed assets (plant and equipment).
Collections of interest.

Aaron Fikes

Mohammed Daher asked:


Cash Receipts from:
customers 270,000
investment by owners 54,000
sale of building 90,000
proceeds from the bank 6,0000
cash payment for:
wages 82,000
taxes 43,000
dividends 20,000
repayment of principal on loan 40,000
purchase of land 106,000
cash balance at the beg of the year 386,000
please I need help to solve this exercise
Thank You

Suzanna Dadson

robert asked:


I want to buy a resale franchise but I don’t know what a good cash flow is .The cash flow sounds too low. any advice? thanks in advance!!

Benton Herrell

PP asked:


How does a loan officer calculate the cash flow when apply for a loan?

Guy Penaz

Eppe asked:


in a business?

Domenic Catalani

sarah asked:


Hi,

Im trying to calculate free cash flow, and i know its cash flows from operations- capital expenditures, but im not sure im subtracting the right numbers. Im looking at RL cash flow statement on yahoo finance and do i only subtract the capital expenditures under the investing activities? That is the only capital expenditures i see. Thanks for the help!

Arianna Szydlowski

Chris B asked:


Bob buys a house to rent out. He puts down $20,000 that he made from turning in his empty beer cans. His loan payment is $500 a month and his other expenses are $100 a month. If BJJB rents the house out for $700 a month, his YEARLY cash flow is

Dave Edington

CollegeBoy00 asked:


http://www.toolkit.cch.com/text/P06_4106.asp (Business Owners tool kit)
Discuss one way that John could improve his cash flow gap. Provide one other example of a business that might have a similar cash flow gap.

Chung Fanelle