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Wells Water Systems recently reported $9,550 of sales, $5,650 of operating costs other than depreciation, and $750 of depreciation. The company had no amortization charges,
Wells Water Systems recently reported $9,550 of sales, $5,650 of operating costs other than depreciation, and $750 of depreciation. The company had no amortization charges, and its federal-plus-state income tax rate was 40%. In order to sustain its operations and thus generate sales and cash flows in the future, the firm was required to spend $850 to buy new fixed assets and to invest $300 in net operating working capital. How much free cash flow did Wells generate?
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