ended December 31, 2015, using Equation 4.1. b. Calculate the firm’ s operating cash flow( OCF) for the year ended
December 31, 2015, using Equation 4.3. c. Calculate the firm’ s free cash flow( FCF) for the year ended December
31, 2015, using Equation 4.4. d. Interpret, compare, and contrast your cash flow estimates in parts b and c.
P4 – 19 Integrative: Pro forma statements Red Queen Restaurants wishes to prepare financial plans. Use the financial statements and the other information provided below to prepare the financial plans.
The following financial data are also available:( 1) The firm has estimated that its sales for 2016 will be $ 900,000.( 2) The firm expects to pay $ 35,000 in cash dividends in 2016.( 3) The firm wishes to maintain a minimum cash balance of $ 30,000.( 4) Accounts receivable represent approximately 18 % of annual sales.( 5) The firm’ s ending inventory will change directly with changes in
sales in 2016.( 6) A new machine costing $ 42,000 will be purchased in 2016. Total
depreciation for 2016 will be $ 17,000.( 7) Accounts payable will change directly in response to changes in
sales in 2016.( 8) Taxes payable will equal one-fourth of the tax liability on the pro