Determining the firm net income


Bartling Energy Systems recently reported $9,250 of sales, $5,750 of operating costs other than to make $1,250 of capital expenditures on new fixed assets and to invest $300 in net operating depreciation, and $700 of depreciation. The company had no amortization charges, it had $3,200 of outstanding bonds that carry a 5% interest rate, and its federal-plus-state income tax rate was 35%. In order to sustain its operations and thus generate sales and cash flows in the future, the firm was required working capital. By how much did the firm's net income exceed its free cash flow?

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Finance Basics: Determining the firm net income
Reference No:- TGS053115

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