The ABC Inc's EBIT in the current year is $65,000 You expect the EBIT to grow by 12% for the next 2 years and 2% thereafter. The depreciation, the change in NWC, and the capital spending are also expected to grow at the same rate as the EBIT. The current level of depreciation, change in NWC, and capital spending are $12000, $43800, and $7500, respectively. 

What is the adjusted free cashflow to the firm (FCFF*) at the end of year 3 (T=3)? Assume the tax rate of 20%.

Answer rating: 100% (QA)

To calculate the adjusted free cash flow to the firm FCFF at the end of year 3 T3 we need to follow ... View the full answer