Given the following data for a given period, compute the free cash flow to the firm: Net Income = $12,000
After-tax Interest Expense = $2,000
Depreciation = $1,000
Increase in NWC = $2,000
Capital Expenditures = $1,000
A) $10,000
B) $11,000
C) $12,000
D) $13,000

Question

Quizplus · Accepted Answer

C) Free cash flow = Net income + After-tax interest expense + Depreciation - Change in NWC - Capital expenditures
Free cash flow = 12,000 + 2,000 + 1,000 - 2,000 - 1,000 = $12,000

Given the Following Data for a Given Period, Compute the Free