Last year Rattner Robotics had $5,000,000 in operating income (EBIT). The company had a net depreciation expense of $1,000,000 and an interest expense of $1,000,000; its corporate tax rate was 40 percent. The company has $14,000,000 in non-interest-earning current assets and $4,000,000 in non-interest-bearing current liabilities; it has $15,000,000 in net plant and equipment. It estimates that it has an after-tax cost of capital of 10 percent. Assume that Rattner" s only noncash item was depreciation.
a. What was the company"s net income for the year?
b. What was the company"s net cash flow?
c. What was the company"s net operating profit after taxes (NOPAT)?
d. If capital in the previous year was $24,000,000, what was the company"s free cash flow (FCF) for the year?
e. What was the company"s Economic Value Added (EVA)?