Given the Following Data for a Given Period, Compute the Free

question 17

Multiple Choice

Given the following data for a given period, compute the free cash flow to the firm: Net Income = $10,000
After-tax Interest Expense = $1,000
Depreciation = $1,000
Increase in NWC = $1,000
Capital Expenditures = $2,000

• A) $9,000
• B) $9,500
• C) $9,700
• D) $9,900

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Definitions:

Annual Interest

The amount of interest payable every year on a loan or investment, typically expressed as a percentage of the principal amount.

High School Graduation

The completion of the required coursework and achievement of necessary credits for a student to officially finish high school and receive a diploma.

Annual Interest Rate

The percentage of principal charged as interest for its use over the span of one year.

Summer Wages

Compensation paid to employees for work performed during the summer season, often applied to temporary or seasonal positions.