Consider the financial statements of Apocalypse Limited below. Income Statements for the Year Ending December 31 (Millions
Question:
Consider the financial statements of Apocalypse Limited below.
Income Statements for the Year Ending December 31 (Millions of Dollars Except for Per Share Data)
Using the information provided, you are required to answer the following questions:
a) The company?s tax rate is 28%. What is the company?s free cash flow at the end of 2016? Show your calculations.
b) How is the company planning to use its free cash flow in 2016? Show your calculations.
c) What is the company?s return on invested capital in 2016? Suppose the company has a 10% weighted average cost of capital. Do you think the company?s growth added value? Support your answer with calculations and explanation.
d) Explain the difference between NOPAT and net income. Which is a better measure of the performance of a company?s operations? Why?
Financial Accounting An Integrated Statements Approach
ISBN: 978-0324312119
2nd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren