You have been asked to estimate the expected free cash flow to the firm next year of Lymon Enterprises, a beverage company. The firm has reported the following: The earnings before interest and taxes in the most recent year amounted to $150 million. The tax rate of the firm is 40%. The firm had operating lease payments of $50 million in the most recent year, and has commitments to make similar payments each year for the next 10 years. The pre-tax cost of debt for the firm is 8%. The book value of equity is $400 million and the book value of debt (not including operating leases) is $100 million The expected growth rate in the earnings before interest and taxes next year is 10% and the return on capital will remain unchanged from this years level.

Estimate the adjusted (for operating leases) return on capital for the firm.