Question
Beckham Broadcasting Company (BBC) has operating income (EBIT) of $2,500,000. The company's depreciation expense is $500,000 and it has no amortization expense. The company is
Beckham Broadcasting Company (BBC) has operating income (EBIT) of $2,500,000. The company's depreciation expense is $500,000 and it has no amortization expense. The company is 100% equity financed. The company has a 40% tax rate, and its net investment in operating capital is $1,000,000. What is BBC's free cash flow?
a. $0
b. $500,000
c. $900,000
d. $1,000,000
e. $1,500,000
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Essentials Of Real Estate Finance
Authors: David Sirota
11th Edition
1419520911, 9781419520914
