Question: Watson Oil recently reported ( in millions ) $ 8 , 2 5 0 of sales, $ 5 , 7 5 0 of operating costs

Watson Oil recently reported (in millions) $8,250 of sales, $5,750 of operating costs other than depreciation, and $600 of depreciation. The company had $3,200 of outstanding bonds that carry a 5% interest rate, and its federal-plus-state income tax rate was 25%. In order to sustain its operations and thus generate future sales and cash flows, the firm was required to make $1,350 of capital expenditures on new fixed assets and to invest $350 in net operating working capital. By how much did the firm's net income exceed its free cash flow?
a. $370.00 million
b. $505.00 million
c. $665.00 million
d. $630.00 million
e. $980.00 million
Watson Oil recently reported ( in millions ) $ 8

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