Kodiak company (dec 09)

Hello Sir!

I’m having problems in computing the depreciation and addition amount which can then be inserted into free cash flow computation.

I solved this way,tell me where I could be wrong:

Depr =10% on the year end non current asset balance before accumulated depreciation (stated in the question)

10% * 1266 =127

let the additions amount be ‘x’

1266 + x = 127 + (1266*1.20)
1266 + x = 127 + 1519
x (additions)= 380

Please help clarify my confusions.

Thank you.