You are trying to estimate the free cash flow to the firm for Wadhwa Inc. and are looking at its most recent financial filings: the annual report for the last fiscal year and its most recent quarterly report for the first three quarters of the current year. Estimate the free cash flow to the firm over the most recent twelve months. (Please read my comment at the end.)

Last fiscal Year (2013) : Revenues $1200, EBITDA$400, Depr & Amort $100, EBIT $300 Interest expenses $75, Taxable Income $225, Taxes $68 Net Income $158, Cap Ex $150, Non-cash WC (End of period) $70

3rd Qtr, 2014: Revenues $400, EBITDA $120, Depr & Amort $30, EBIT $90, Interest expenses $25, Taxable Income $65, Taxes $26, Net Income $39, Cap Ex $45, Non-cash WC (End of period) $80

3rd Qtr, 2013: Revenues $325, EBITDA $95, Depr & Amort $25, EBIT $70, Interest expenses$15, Taxable Income $55, Taxes $22, Net Income $33, Cap Ex $35, Non-cash WC (End of period) $100

First 3 Qtrs, 2014: Revenues $1100, EBITDA $350, Depr & Amort $90, EBIT $260, Interest expenses $70, Taxable Income $190, Taxes $57, Net Income $133, Cap Ex $130, Non-cash WC (End of period) $80

First 3 Qtrs, 2013: Revenues $850, EBITDA $300, Depr & Amort $75, EBIT $225, Interest expenses $55, Taxable Income $170, Taxes $51, Net Income $119, Cap Ex $110, Non-cash WC (End of period) $100 Comment: I think "the most recent twelve months" refers to the 4th Qtr, 2013, the 1st, 2nd and 3rd Qtr, 2014. The values in 4th Qtr, 2013 can be calculated by values of last fiscal year (2013) minus values of First 3rd Qtrs,2013. A change in Non-cash WC can be computed as $80 -$100 = ($20). What I don't understand is how to determine the tax rate since it varies across periods between 30% to 40%.