Multiple Choice: Problems (252-50) Firm MMA has EBIT (operating income) of $3 million, depreciation of $1 million. Pirm a s expenditures on fixed anneta - $1 million. Its net operating working capital - $0.6 million.Calculate for free cash flow. Imagine that the tax rate 40t. a. 91.2 b. $1.3 c. $1.4 Firm AAA's sales - $150,000, operating costs (no depreciation) - $75.500. Depreciation - $10,200, Tax rate 35. Pirm M b ond value is $16,500 and the interest rate of the bond is 7.251. Calculate for net income. (Hint: Interest - bond value interest rate. Sales - costs - depreciation - EBIT - interest - EBT - EDT tax rate - net income) a. $31163.91 b. $38132.46 c. $41017.44 3. Refer to the following balance sheet and calculate net operating working capital (hint: Net operating working capital - Current assets-(Current liabilities - Notes payable) Cash $ 100 Accounts payable $ 200 Accounts receivable 650 Accruals 350 Inventory 550 Notes payable 350 Current assets $1,300 Current liabilities $ 900 Net fixed assets 1,000 Long-term debt 600 Common equity 300 Retained earnings 500 Total assets $2,300 Total liab. & equity $2,300 a. $695 b. $750 c. $735 Firm AAA's total asset - $720,000. This company has no debt, so its debt/equity ratio = 0t. Now the CEO wants to raise the debt/assets ratio to 40%. How much must the firm borrow to achieve this goal? a. $273,600 b. $288,000 c. $302,400