Operations Cash Flows

dabatuwa's version from 2015-05-26 02:34

Additions to Net working capital

Question Answer
Operating cash flowsCash flows from the firm's producing and selling products on a day-to-day basis.
Net capital spendingNet spending on fixed assets.
Operating Cash Flow is calculated fromIncome statement.
Net capital spending is calculated fromBoth the balance sheet and the income statement.
Net new borrowingnaww
Future ValueCompounding or growth over time (WHAT IS THE VALUE OF $1 TODAY IN THE FUTURE?


Question Answer
Present Valuediscounting to today’s value (WHAT IS THE VALUE TODAY OF $1 IN THE FUTURE?)
FVPV((1 + k)^N)
PVFV/((1 + k)^N)
Operating Cash Flow formulaEBIT + depreciation - taxes
Net capital spending formulaEnding net fixed assets - beginning net fixed assets + depreciation.
Net new borrowing formulaEnding LTD - Beginning LTD
Cash flow to stockholders formulaDividends paid - net new equity raised.


Question Answer
Net new equity raised formulaEnding common stock and paid surplus - Beginning common stock and paid surplus.
Additions to NWC formulaEnding NWC - Beginning NWC
Cash Flow to Creditors formulaInterest paid - Net new borrowing.
Cash flow from assets (summation)Cash flow to creditors + cash flow to stockholders.
Cash flow from assets (differential)Operating cash flows - net capital spending - additions to net working capital