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djyliett [7]
3 years ago
15

Charles Underwood Agency Inc. has an expected net operating profit after taxes, EBIT(1 – T), of $17,400 million in the coming ye

ar. In addition, the firm is expected to have net capital expenditures of $2,610 million, and net working capital (NWC) is expected to increase by $30 million. How much free cash flow (FCF) is Charles Underwood Agency Inc. expected to generate over the next year?
Business
1 answer:
strojnjashka [21]3 years ago
4 0

Answer:

$14,760 million

Explanation:

The computation of the free cash flow is shown below:

= EBIT × (1 -Tax Rate) + Depreciation & Amortization - Change in Net Working Capital - net capital Expenditure.

= $17,400 + $0 - $30 million - $2,610 million

= $14,760 million

Simply we deduct the changes in net working capital and net capital expenditure from the EBIT (1 - tax rate) so that the accurate value can come.

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Explanation:

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Answer:

The question that corresponds to this is

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