Question Details

Use the following information for Questions 1 through 4:
Assume that you recently graduated and have just reported to work as an investment advisor at the one
of the firms on Wall Street. You have been presented and asked to review the following Income
Statement and Balance Sheets of one of the firm- clients. Your boss has developed the following set of questions you must answer.

1. What is the free cash flow for 2014?
2. Suppose Congress changed the tax laws so that Berndt- depreciation expenses doubled. No
changes in operations occurred. What would happen to reported profit and to net cash flow?
3. Calculate the 2014 current and quick ratios based on the projected balance sheet and income
statement data. What can you say about the company- liquidity position in 2013?
4. Use the extended DuPont equation to provide a summary and overview of company- financia