You Are Considering an Investment in Cruise, Inc

question 92

Multiple Choice

You are considering an investment in Cruise, Inc. and want to evaluate the firm's free cash flow. From the income statement, you see that Cruise earned an EBIT of $202 million, paid taxes of $51 million, and its depreciation expense was $75 million. Cruise's gross fixed assets increased by $70 million from 2017 to 2018. The firm's current assets decreased by $10 million and spontaneous current liabilities increased by $6 million. What is Cruise's operating cash flow, investment in operating capital, and free cash flow for 2018, respectively, in millions?

• A) $202, $70, $130
• B) $226, $70, $156
• C) $226, $54, $172
• D) $226, $74, $152

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Definitions:

Downtown Washington

Downtown Washington refers to the central business district and political center of Washington D.C., characterized by significant landmarks such as the White House and the U.S. Capitol.

Categorical Variables

Variables that denote categories and can assume one among a limited, typically constant, set of possible values.

Quantitative Variables

Variables that can be quantified and measured numerically.

Median Age

The age that divides a population into two numerically equal groups, where half the population is younger and half is older.