Compute and analyse free cash flow

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Question - Assume fixed asset turnover ratio is 2.5 and you will see that Kuulab needs external funds in the following years.

1. Adjust payout ratio, or short-term/long-term debt to make EFN zero. (Make sure your debt ratio is less than 100%)

2. Compute and analyse financial ratios using Pro Forma statements.

3. Compute and analyse Free cash flow.

4. How can you make EFN positive? For example, you can change sales to make EFN positive. Explain.

5. Assume that Kuulab Corporation wants to have lower debt ratio and you are a CFO. Which changes need to Kuulab Corp? Explain.

Reference no: EM133188554

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