we focused on two methods to determine how much cash is available for dividend payments. Residual distribution method, and by using free cash flow. For your project and the analysis of the public company, the free cash flow method would be a good approach for analysis. So, given the following data for Year-1:

Net Income = $4 million; Depreciation = $2 million; Investment in fixed assets = $1 million; Investment in net working capital = $500,000. Principal payments on debt were $1 million. New debt raised totaled $1.0 million during the period. Calculate the free cash flow to equity (FCFE) for Year 1 (please show your work):