Cash flows and financial basics about the business

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Reference no: EM131572888

As a soon-to-be business baccalaureate from Indiana University, your proud parents are wanting you to take over the family business, starting on January 15, 2017. The firm specializes in business computing solutions, maintenance, and repairs, focusing on commercial clients in the Indy-Louisville-Cincy region. Before accepting this offer, you want to know more about the business. First, you decide to get a better understanding of the cash flows and other financial basics about the business. On December 31, 2016, your parents give you this information about the business for the calendar year 2016:

Financial Summary for 2016 (all numbers in thousands of USD)

Net Sales: 850

COGS: 400

Depreciation: 250

Interest expense: 77

Taxes paid: 49

Dividends: 50

Net capital spending: 290

Net increase in Working capital: 50

Net new borrowing: 300

Total interest-bearing Debt as of 12/31: 1,600

Based upon the Financial Summary for 2016 provided above, compute the following numbers

1. EBIT

2. Taxable Income

3. Tax Rate (based upon Taxable Income)

4. Net Income

5. Addition to retained earnings

6. Operating cash flow

7. Cash flow from assets

8. Cash flow to creditors

9. Cash flow to shareholders

10. How much net new equity was raised (or retired)?

Reference no: EM131572888

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