Question

Cellular​ Access, Inc., a cellular telephone service provider reported net income of $ 254.4 million for the most recent fiscal year. The firm had depreciation expenses of $ 104.6 ​million, capital expenditures of $ 192.5 ​million, and no interest expenses. Net working capital increased by $ 9.1 million. Calculate the free cash flow for Cellular Access for the most recent fiscal year.

Answer 1

Answer:

$157.4

Explanation:

EBIT(1 - t) = $254.4 million

Depreciation expenses = $104.6 million

Capital expenditures = $192.5 ​million

Net working capital increased by = $9.1 million

Free Cash Flows:

= EBIT(1 - t) + Depreciation & Amortization - Changes in Working Capital - Capital Expenditure

= $254.4 + $104.6 ​- $9.1 - $192.5 ​

= $157.4 million