Cassia Wool Company management is doing some financial planning for the coming y

Question

Cassia Wool Company management is doing some financial planning for the coming year. Cassia plans to raise $10,000 in new equity this year and wants to pay a dividend to stockholders of $30,000. The firm must pay $20,000 of interest during the year and will also pay down principal on its debt obligations by $10,000. Its capital budgeting plan calls for $100,000 of capital expenditures during the year. Given the above information, how much cash must be provided from operations for the firm to meet its plan?

Explanation / Answer

Cash provided from operations is $ 20000 for interest

Note: Cash from operations mainly focus on cash inflow and outflow from company main business activities of buying and selling goods and providing services.

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