Question: Use the information below to answer problems 5-11. The firm's plowback ratio is 60% and the average tax rate is 30%. 2015 2016 Sales $3,500
Use the information below to answer problems 5-11. The firm's plowback ratio is 60% and the average tax rate is 30%.
| 2015 | 2016 | |
| Sales | $3,500 | |
| Cost of Goods Sold | $1,800 | |
| Depreciation Expense | $875 | |
| Interest Expense | $425 | |
| Current Assets | $2,000 | $2,500 |
| Total Fixed Assets | $6,200 | $7,300 |
| Accumulated Depreciation | $1,300 | This can be determined from the information given |
| Current Liabilities | $1,300 | $1,500 |
| Long-term Debt | $3,500 | $3,700 |
| Common Stock | $1,200 | This can be determined from the information given |
1-What is the 2016 CFC?
2-What is the 2016 CFS?
3-Show that the FCF calculated as the sum of CFC and CFS is the same as the FCF calculated using OCF, NCS, and change in NWC.
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