Peach Farm recently reported $10,250 of sales, $5,750 of operating costs other than depreciation, and $500 of depreciation. The ompany had no amortization charges, it had $3,200 of outstanding bondsthat carry a 6% interest rate, and its federal-plus-state income tax rate was 40%. In order to sustain its operations, the firm was required to make $1,200 of capital expenditures on new fixed assets and to invest $300 in netoperating working capital. By how much did the firm's net income exceed its free cash flow?

a. $1384.80

b. $1308.70

c. $746.00

d. $783.30

e. $884.80