Free cash flow to equity (FCFE) is defined as the cash flowremaining after meeting all financial obligations, including debt payment, and after covering capital expenditure and working capitalneeds. The FCFE is a measure of how much the firm can afford to payout as dividend, but in a given year may be more or less than the amount actually paid out.

 

Sundanci's FCFE for the year 2000 is calculated as follows:

Earnings after tax=

Plus: Depreciation expense=

Less: Capital expenditures=

Less: Increase in NWC=

Equals: FCFE=

/ number of shares=

Equals: FCFE per share=

Transcribed Image Text:

Design Layout References mes New Ro... 11 Y A- A- Aa I U ✓abe X₂ X² (5 points) Income Statement Revenue Depreciation Sundanci Actual 1999 and 2000 Financial Statements For Fiscal Years Ending May 31 (S million, except per-share data) Other operating costs Income before taxes Taxes Net income Dividends Earnings per share Dividend per share Common shares outstanding (millions) Balance Sheet Current assets Net property, plant and equipment Total Assets Current liabilities. Long-term debt Total Liabilities Mailings Review View Shareholders Equity Total liabilities and equity Capital expenditures 5307 Words 06 English (US) 186 187 188 1999 $474 20 368 86 26 60 18 $0.714 $0.214 84.0 1999 $201 474 675 57 57 618 675 34 2000 $598 23 460 115 35 80 24 $0.952 $0.286 84.0 2000 $326 489 815 A. Styles 141 0 141 674 815 38 . equals: FCFE per share Design Layout References mes New Ro... 11 Y A- A- Aa I U ✓abe X₂ X² (5 points) Income Statement Revenue Depreciation Sundanci Actual 1999 and 2000 Financial Statements For Fiscal Years Ending May 31 (S million, except per-share data) Other operating costs Income before taxes Taxes Net income Dividends Earnings per share Dividend per share Common shares outstanding (millions) Balance Sheet Current assets Net property, plant and equipment Total Assets Current liabilities. Long-term debt Total Liabilities Mailings Review View Shareholders Equity Total liabilities and equity Capital expenditures 5307 Words 06 English (US) 186 187 188 1999 $474 20 368 86 26 60 18 $0.714 $0.214 84.0 1999 $201 474 675 57 57 618 675 34 2000 $598 23 460 115 35 80 24 $0.952 $0.286 84.0 2000 $326 489 815 A. Styles 141 0 141 674 815 38 . equals: FCFE per share

Answer rating: 100% (QA)

FCFE Net Income Depreciation Capital expenditure Increase in working capital New debt is... View the full answer