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Cellular Access, Inc. is a cellular telephone service provider that reported net income of $250 million for the most recent fiscal year. The firm had depreciation expenses of $100 million, capital expenditures of $200 million, and no interest expenses. Working capital increased by $10 million. Calculate the free cash flow for Cellular Access for the most recent fiscal year.

Respuesta :

Answer:

$140 million

Explanation:

Given that

Net income = $250 million

Depreciation = $100 million

Capital expenditure = $200 million

Increased working capital = $10 million

The calculation of free cash flow for Cellular Access is here below:-

Free cash flow for Cellular Access = Net income + Depreciation - Capital expenditure - Increased working capital

= $250 million + $100 million - $200 million - $10 million

= $350 million - $200 million - $10 million

= $140 million

Therefore we have applied the above formula.

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