3. Evaluating free cash flows and return on invested capital You are an industry analyst for the telecom sector. You are analyzing financial reports from two companies: CellT Corp. and Talk2Me Inc. Corporate tax for both firms is 35%. Your associate analyst has calculated and compiled, in the following table, a list of important figures you need for the analysis: EBIT Depreciation Data Collected Total operating capital Net investment in operating capital WACC CellT Corp. $127,500 $51,000 $749,700 $357,000 8.84% Talk2Me Inc. $90,780 $36,312 $584,970 $188,700 11.50% In your analysis, you want to look for several characteristics-one of them being the return on invested capital (ROIC). Using the information available, complete the following statements: .CellT Corp. has a free cash flow than Talk2Me Inc. The net operating profit after taxes (NOPAT) for CellT Corp. is .CellT Corp. has an ROIC of I whereas the NOPAT for Talk2Me Inc. is whereas Talk2Me Inc. has an ROIC of Your inference from the analysis is that both firms are in a high-growth phase, and their growth will be profitable. Considering your analysis, which of the following statements is true? If ROIC is greater than the rate of return that investors require, which is the weighted average cost of capital (WACC), then the firm is adding value. If ROIC is less than the rate of return that investors require, which is the weighted average cost of capital (WACC), then the firm is MacBook Air.

3. Evaluating free cash flows and return on invested capital You are an industry analyst for the telecom sector. You are analyzing financial reports from two companies: CeliT Corp. and TalkzMe Inc. Corporate tax for both firms is 35%. Your associate analyst has calculated and compiled, in the following table, a list of important figures you need for the analysis: In your analysis, you want to look for several characteristics - one of them being the retum on invested capital (Roic), Using the informatien available, complete the following statements: - Celit Corp, has a free cash flow than Task2Me Inc. - The net operating profit after taxes (NOPAT) for Celit Corp. is , whereas the NOPAT for Tolik2Me inc, is - Celit Corp. has an Roic of - whereas Talka Me inc, has an RotC of Your inference from the analysis is that both firms are in a high-growth phase, and their growth wit be profitable. Considering your analysis, which of the following statements is true? If ROIC is greater than the rate of return that investors require, which is the weighted average cost of capital (WACC), then the firm is adding value. If RotC is less than the rate of return that investors require, which is the weighted average cost of capital (WACC), then the firm is 3. Evaluating free cash flows and return on invested capital You are an industry analyst for the telecom sector, You are analyzing financial reports from two companies: CelT Corp. and Talk2Me Inc. Corporate tax for both firms is 35%. Your associate analyst has calculated and complled, in the following table, a tist of important figures you need for the analysis: In your analysis, you want to look for several characteristics-one of them being the return on invested capital (ROIC). Using the information available, complete the follawing statements: - Celir corp. has a free cash flow than Talkame inc. - The net operating profit after taxes (NOPAT) for Ceitr Corp, is , whereas the NOPAT for Taik2Me inc is - Celit Corp. has an ROIC of , whereas Tak2Me Inc, has an RoIC of Your inference from the analysis is that both firms are in a high-growth phase, and their growth will be profitable. Considering your analysis, which of: the following statements is true? If ROtC is greater than the rate of retum that investors require, which is the weighted average cost of capital (WACC), then the firm is adding value. If ROIC is less than the rate of return that investors require, which is the weighted average cost of capital (WACC), then the firm is