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.