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JCB Inc, recently reported $8.0 million in sales, $5.80 million of operating costs other than depreciation, and $400,000 of depreciation. The company had no amortization
JCB Inc, recently reported $8.0 million in sales, $5.80 million of operating costs other than depreciation, and $400,000 of depreciation. The company had no amortization charges, it had $3.0 million of outstanding bonds that carry a 4% interest rate, and its federal-plus-state income tax rate was 25%. In order to sustain its operations and thus generate sales and cash flows in the future, the firm was required to make $900,000 of capital expenditures on new fixed assets and to invest $200,000 in net operating working capital. By how much did the firm's net income exceed its free cash flow? $595,000 O $752,500 $812.275 $610,000
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