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Last year Pearson Brothers had $10 million in operating income before interest and tax (EBIT)....

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Finance

Last year Pearson Brothers had $10 million in operating income before interest and tax (EBIT). Its depreciation expense was $3 million; its interest expense was $1 million; and its corporate tax rate was 25%. At year-end it had $16 million in current assets (Cash+A/R+Inventory), $5 million in account payable, 3 million in note payable, 2 million in accruals, and $20 million in net plant and equipment. There is no excess cash

If total net operating capital at the end of the previous year was 26 million, what was the companys free cash flow (FCF) for the year?

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