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9. Evaluating free cash flows and return on invested capital You're an industry analyst for the telecom sector, and have been analyzing financial reports from two companies: Blastel Inc. and Sane Tel Corp. The corporate tax rate for both firms in 35%. Your associate analyst has calculated and compiled, in the following table, a list of important figures you'll probably need for the analysis: Data Collected BlastTel Inc. EBIT $200,900 Depreciation $66,297 Total operating capital 5882,000 Net investment in operating capital $441,000 WACC 11.85% SaneTel Corp. $73,500 $24,255 $458,640 $191,100 11.88% In your analysis, you want to look for several characteristics--one of them being the return on invested capital (ROIC), Using the information available, complete the following statements: Ch 06: Assignment - Accounting for Financial Management in your analysis, you want to look for several characteristics one of them being the return on invested capital (ROIC). Using the information available, complete the following statements: BlastTel Inc. has a free cash flow than Sane Tel Corp. does The net operating profit after tax (NOPAT) for BlastTel Inc. is whereas the NOPAT for Sane Tel Corp. is BlastTal Inc. has a return on invested capital of whereas, Sane Tel Corp. has a return on invested capital of Your Inference from the analysis is that both firms are in a high-growth phase, and their growth will be profitable. Considering your analysis, which of the following statements is true? of a company has negative NOPAT but a positive free cash flow, then the firm could be in a high-growth phase and making investments in operating capital to support growth. If a company has positive NOPAT but a negative free cash flow, then the firm could be in a high-growth phase and making investments in operating capital to support growth. Grade It Now Save & Continue Continue without saving

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