Ref 11-2 Champagne, Inc., Had Revenues of $12 Million, Cash Operating Expenses

question 22

Multiple Choice

Ref 11-2
Champagne, Inc., had revenues of $12 million, cash operating expenses of $8 million, and depreciation and amortization of $1.5 million during 2008. The firm purchased $700,000 of equipment during the year while increasing its inventory by $500,000 (with no corresponding increase in current liabilities) . The marginal tax rate for Champagne is 30 percent.
-Free cash flow: What is Champagne's NOPAT for 2008?

• A) $1,750,000
• B) $2,500,000
• C) $3,250,000
• D) $4,000,000

---

Definitions:

Cognitive Psychologist

A psychologist who studies how we perceive, think, understand, and remember information.

Physiological Psychologist

A specialist who studies the biological basis of behavior, focusing on the brain's functions and structures and their impact on psychological processes.

Associative Learning

The process by which an individual learns the connection between two stimuli or between a behavior and a consequence.

Ivan Pavlov

A Russian physiologist known for his work in classical conditioning, primarily through experiments involving the conditioning of dogs.