A company recently reported operating income of $500.0 million, depreciation of $50.0 million, and had a tax rate of 21%. The firm's expenditures on fixed assets and net operating working capital totaled $10.0 million. How much was its free cash flow, in millions? O $435.00 O $455.00 O $335.00
A company recently reported operating income of $500.0 million, depreciation of $50.0 million, and had a tax rate of 21%. The firm's expenditures on fixed assets and net operating working capital totaled $10.0 million. How much was its free cash flow, in millions? O $435.00 O $455.00 O $335.00
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
![A company recently reported operating income of $500.0 million, depreciation of $50.0 million, and had a tax rate of 21%. The firm's expenditures on fixed assets and net operating working capital totaled $10.0
million. How much was its free cash flow, in millions?
O $435.00
O $455.00
O $335.00](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F37e2f913-30b2-4c8c-98d5-339163057ff1%2F30451f92-cbbe-444f-b74f-deddac0f172b%2Fht6pv15_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A company recently reported operating income of $500.0 million, depreciation of $50.0 million, and had a tax rate of 21%. The firm's expenditures on fixed assets and net operating working capital totaled $10.0
million. How much was its free cash flow, in millions?
O $435.00
O $455.00
O $335.00
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
Information;
Operating income = $500 million
Depreciation = $50 million
Tax rate = 0.21
Expenses on fixed assets and net working capital = $10 million
Free cash flow = ?
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