medium · Principles of Finance valuation

When calculating FCFE per share starting from FCFF, which of the following adjustments is necessary to correctly isolate the cash flow available to equity holders?

1. Add back Interest Expense and subtract Net Borrowing from the FCFF figure.
2. Subtract After-Tax Interest Expense and add Net Borrowing.
3. Add Dividends paid to common shareholders during the period.
4. Subtract Capital Expenditures and add back Depreciation expense.

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