Question
In: Finance
Hartzell Inc. had the following data for 2017, in millions: Net income = $600; after-tax operating...
Hartzell Inc. had the following data for 2017, in millions: Net income = $600; after-tax operating income [EBIT (1-T)] = $700; and Total assets = $2,000. Information for 2018 is as follows: Net income = $825; after-tax operating income [EBIT (1-T)] = $825; and Total assets = $2,500. Assume the firm had no excess cash. How much free cash flow did the firm generate during 2018?
| a. |
$325 |
|
| b. |
$367 |
|
| c. |
$257 |
|
| d. |
$286 |
|
| e. |
$397 |
Solutions
Expert Solution
Free cash flow = EBIT(1 - t) - Increase in capital expenditure
Free cash flow = $825 - ($2,500 - $2,000)
Free cash flow = $325
jeff jeffy answered 3 years agoRelated Solutions
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