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Madrigal Group recently reported $1,500,000 of sales, $630,000 of operating costs other than depreciation, and $99,000 of depreciation. The company had $1,090,500 of outstanding bonds
Madrigal Group recently reported $1,500,000 of sales, $630,000 of operating costs other than depreciation, and $99,000 of depreciation. The company had $1,090,500 of outstanding bonds that carry a 7.50% interest rate, and its federal-plus-state income tax rate was 35%. In order to sustain its operations and thus generate future sales and cash flows, the firm was required to spend $805,000 to buy new fixed assets and to invest $10,500 in net operating working capital. 1. What was the firm's free cash flow? 2. What was the firm's net income
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