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Sonja [21]
2 years ago
9

Houston Pumps recently reported $172,500 of sales, $140,500 of operating costs other than depreciation, and $9,250 of depreciati

on The company had $35,250 of outstanding bonds that carry a 6.75% interest rate, and its federal-plus-state income tax rate was 25%. In order to sustain its operations and thus generate future sales and cash flows, the firm was required to spend $15,250 to buy new fixed assets and to invest $6,850 in net operating working capital. What was the firm's free cash flow?
a. $1,860
b. $4,213
c. $1,589
d. $2,286
e. $1,976
Business
1 answer:
Xelga [282]2 years ago
6 0

Answer:

b. $4,213

Explanation:

Net Operating Profit = Sales - Operating costs - Depreciation Expenses

Net Operating Profit = $172,500 - $140,500 - $9,250

Net Operating Profit = $22,750

Free Cash Flow (FCF) = Net Operating Profit After Tax(NOPAT) – Capital Expenditures – Changes in Net Working Capital

Free Cash Flow (FCF) = Net operating income*(1 - Tax Rate) + Depreciation Expenses - Capital Expenditures - Changes in Net Working Capital

Free Cash Flow (FCF) = $22,750 *(1 - 0.25) + $9,250 - $15,250 - $6,850

Free Cash Flow (FCF) =  $22,750 *0.75) + $9,250 - $15,250 - $6,850

Free Cash Flow (FCF) = $17,063 + $9,250 - $15,250 - $6,850

Free Cash Flow (FCF) = $4,213.

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Answer:

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Explanation:

The science of it is related to the psychology of what makes people laugh.

If studied, one would realize that there are certain things that are bound to make people laugh (all things being equal). An example is when a person makes fun of themself to an audience.

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A plausible explanation (which is more recent in the parlance of psychology) is that people also laugh when certain expectations are defied in a very witty manner.

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There those who are gifted naturally with a principle thought process that elicits laughter from others, would be termed hilarious. However, to make a living out of comedy, one would need to fully understand the principles and practice to deliver them as naturally as possible.

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Cheers!

6 0
2 years ago
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