6. Your pro forma income statement shows sales of $1,047,000, cost of goods sold as $495,000, depreciation expense of $96,000, and taxes of $114,000 due to a tax rate of 25%. What are your pro forma earnings? What is your pro forma free cash flow?

7. You are evaluating a new product. In year 3 of your analysis, you are projecting pro forma sales of $5.9 million and cost of goods sold of $3.54 million. You will be depreciating a $2 million machine for 5 years using straight-line depreciation. Your tax rate is 33%. Finally, you expect working capital to increase from $210,000 in year 2 to $300,000 in year 3. What are your pro forma earnings for year 3? What are your pro forma free cash flows for year 3?

8. Daily Enterprises is purchasing a $10.4 million machine. It will cost $53,000 to transport and install the machine. The machine has a depreciable life of five years using straight-line depreciation and will have no salvage value. The machine will generate incremental revenues of $4.2 million per year along with incremental costs of $1.1 million per year. Daily's marginal tax rate is 21%. You are forecasting incremental free cash flows for Daily Enterprises. What are the incremental free cash flows associated with the new machine?

11. Cellular Access, Inc., a cellular telephone service provider, reported net income of $253.1 million for the most recent fiscal year. The firm had depreciation expenses of $99.2 million, capital expenditures of $207.7 million, and no interest expenses. Net working capital increased by $9.9 million. Calculate the free cash flow for Cellular Access for the most recent fiscal year.