Question: Houston Pumps recently reported $ 1 8 5 , 0 0 0 of sales, $ 1 4 4 , 0 0 0 of operating costs

Houston Pumps recently reported $185,000 of sales, $144,000 of operating costs other than depreciation, and $7,750 of depreciation. The company had $35,250 of outstanding bonds that carry a 6.75% interest rate, and its federal-plus-state income tax rate was 25%. In order to sustain its operations and thus generate future sale and cash flows, the firm was required to spend $15,250 to buy new fixed assets and to invest $6,050 in net operating working capital. What was the firm's free cash flow?
a. $11,950.00
b. $26,637.50
C. $17,437.50
d. $11,387.50
2. $19,700.00
Houston Pumps recently reported $ 1 8 5 , 0 0 0

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