Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › June 2014 Q3 Vogel Co
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John Moffat.
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- November 16, 2014 at 10:30 am #210397
Hi Sir
Regards to Free cash flow of Ndege co. why do we need to deduct the debt of $40m from the calculations?
And for this question part (a) there is this organic growth, can u explain what it mean?
November 16, 2014 at 4:28 pm #210465Using free cash flow gives the value of the firm (equity plus long-term debt). So need to subtract the debt to get the value of the equity.
Organic growth is internal growth (as opposed to growing by acquisition of other businesses).
November 17, 2014 at 10:16 am #210653ok thanks Sir
Sir can u give an example on Internal growth?
November 17, 2014 at 1:16 pm #210690Internal growth is growing by (for example) increasing market share, or by developing new products.
November 19, 2014 at 3:37 am #211163ok thank u sir?
November 19, 2014 at 5:21 pm #211322You are welcome 🙂
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