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You have been taking a look at AT&Ts current cash balance. The firm has $ 7 billion in cash on its balance sheet at the

You have been taking a look at AT&Ts current cash balance. The firm has $ 7 billion in cash on its balance sheet at the end of 1998, an increase of $ 1.5 billion over the balance at the end of 1997. The firm paid out 20% of its 1998 earnings as dividends, bought back $ 1 billion of stock and reported capital expenditures of $ 3 billion and depreciation of $ 2 billion during 1998; the non-cash working capital at the firm decreased by $ 0.5 billion during the year. In addition, AT&Ts total debt increased from $ 40.3 billion at the start of the year to $ 39.5 billion at the end. Estimate AT&Ts net income for 1998.

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