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Answer: 73
The correct answer is **C** (73). **Explanation:** FCFF can be calculated from cash flow from operating activities (CFO) as follows: \[ FCFF = CFO + \text{Int}(1 - \text{Tax rate}) - \text{FCInv} \] Where: - **CFO** is cash flow from operating activities (80). - **Int** is interest paid (10). - **Tax rate** is 20% (0.20). - **FCInv** is capital expenditures (15). Substituting the values: \[ FCFF = 80 + [10 \times (1 - 0.20)] - 15 = 80 + 8 - 15 = 73 \] **Why not A or B?** - **A (57)**: Incorrectly deducts the after-tax interest adjustment instead of adding it back. - **B (65)**: Assumes interest is included in financing activities and does not adjust for after-tax interest.
Author: LeetQuiz Editorial Team
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An analyst collects the following financial data (in € thousands) for a company:
A
57
B
65
C
73
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