You are an industry analyst in the telecommunications sector. You are analyzing financial reports for two companies: Talker Corp. and MobileTalk Inc. The corporate tax for both companies is 35%. Your associate analyst has calculated and compiled, in the following table, a list of important figures you need for the analysis:

Data collected

	Talker Corp.	Mobile Talk Inc.
EBIT	$164,000	$60,000
Depreciation	$54,120	$19,800
Total operating capital	$720,000	$374,400
Net investment in operating capital	$360,000	$156,000
WACC	11,85%	11,88%

In your analysis, you want to look for several characteristics, one of them is return on invested capital (ROIC). Using the information available, complete the following statements:

•	Talker Corp.'s net operating income after tax (NOPAT) is $ ,  while the NOPAT for Mobile Talk Inc. is $ .
•	Talker Corp. has free cash flow of  , while MobileTalk Inc. has free cash flow of
•	Talker Corp. has a  return on invested capital than MobileTalk Inc.

Their inference from the analysis is that both companies are in a high growth phase and their growth will be profitable. Given his analysis, which of the following statements is true?

A) If a company has a negative NOPAT but positive free cash flow, then the company could be in a high growth phase and making investments in working capital to support growth.

B If a company has a positive NOPAT but negative free cash flow, then the company could be in a high growth phase and making investments in working capital to support growth.