Hi,

I need help solving the question in the file attached. some explanation will be highly appreciated.

Thank you

Question # 2 Balance Sheet as of December 31 Assets Cash A/R Inv Total CA 2014 2015 $ 1,000 1,500 2,000 $ 4,500 $ 1,100 1,650 2,200 $ 4,950 11,000 (4,500) 6,500 12,150 (5,100) 7,050 $11,000 $12,000 $ $ PPE (at cost) Acc. Depreciation Net PPE Total assets Liabilities and Equity Accrued liabilities A/P Notes/Payable Total CL Long-term debt Common stock R/E Total liabilities and equity 800 1,200 5,500 $ 7,500 880 1,320 6,050 $ 8,250 2,000 1,000 500 1,602 1,000 1,148 $11,000 $12,000 Income Statement for the year Ending December 31, 2015 Sales CGS Depreciation SG&A Interest expense Taxable Income Taxes $10,000 6,000 600 1,000 600 $ 1,800 720 Net Income $ 1,080 Required: a. Prepare FCF statement. b. Compute FCF using the adjustment method: c. Compute FCF CFO * CFI * with (i) Cash excluded and (ii) Cash included. What FCF NOPAT NOA is the difference between the two FCFs