Problem:
Champagne, Inc., had revenues of $12 million cash operating expenses of $8 million, and depreciation and amortization of $1.5 millionn during 2008. The firm purchase $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 #0 percent.
Required:
Question: What is Champagne's free cash flow for 2008?
Note: Please show basic calculation