Analyzing Statements of Cash Flows II
3 important questions on Analyzing Statements of Cash Flows II
What is Free cash low to the firm (FCFF) + formula (3 ways)
is cash available to all investors, both equity owners and debtholders.
What is Free cash low to equity (FCFE) and formula
is the cash low available for distribution to common shareholders
cfo - fixed capital investment +- Net borrowing (debt issued - debt paid)
cfo - fixed capital investment +- Net borrowing (debt issued - debt paid)
What do performance ratio's (start with cash) and coverage ratio (have coverage) have in common
Always start with cfo in the numenator
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