Question

True or False. Based on the image below, Cookie Monster is the shareholder of Cookie Management...

  1. True or False. Based on the image below, Cookie Monster is the shareholder of Cookie Management Company (France), and he is also the shareholder and owner of Sub 1 (Chocolate Chip Manufacturing Facility (Germany)).   
    1. True.
    2. False.
  2. True or False. We discussed in class the difference between Free-Cash-Flows Based Valuation model of a business and Dividends-Based Valuation Model. Free-Cash-Flow Based Valuation was looking at the cash that is “free” for the company after looking at the flow of cash into the company versus the flow of cash out of the business. True or False – Free Cash Flow valuation results in a higher valuation.   
  1. True.
  2. False.
Business   Accounting   
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Answer #1

Image is not available.So Answer for question 1 cannot be arrived at

For Question 2 Answer is True.

Free cash flow is calculated after taking all inflows of cash and subtracting all outflows of cash from it.and the balance that is available for the share holders are free cash flows.Dividend is a percentage arrived based on availability of free cash flows.Though Dividend is paid on each share the quantum of dividend is fixed based on free cash flows that company could generate over the year and also using some of accumulated reserves from past years

Free Cash flow based valuation results in higher valuation as compared to dividend based valuation is just because dividend is part of free cash flows.Dividend is just a percentage arrived based on the availability of free cash flows

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