Exercise 12-10 Information for two companies in the same industry, Cheyenne Corp

Question

Exercise 12-10 Information for two companies in the same industry, Cheyenne Corp. and Novak Corp., is presented here. Cheyenne Novalk Cara, Cara. Net cash provided by operating actives 82,010 $108,200 Average current liabilities Net income Capital expenditures Dividends paid 48,200 102,300 215,500 215,500 43,380 66,130 5,0909,600 Compute free cash flow for both companies and compare. (Show a negative free cash flow with either a -sign e.g. -15,000 or in parenthesis e.g. (15,o0o). Che Free cash flow 's free cash flow is better Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT

Explanation / Answer

Free Cash Flow = Cash Flow From Operating Activities - Capital Expenditures Cheyenne Corp. Novak Corp. Free Cash Flow = Cash Flow From Operating Activities =   $            82,010.00 $    1,08,200.00 Less : Capital Expenditures $            43,380.00 $       66,130.00 = $            38,630.00 $       42,070.00 Free Cash Flow Cheyenne Corp. Novak Corp. $            38,630.00 $       42,070.00 Novak Corp. Cash flow is more better because the more free cash flow comparing to Cheyenne

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