### Calculating operating income before tax-free cash flow

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##### Reference no: EM13826350

Problem:

Consider a firm with the following characteristics: (1) beginningâ€ofâ€year net operating capital = \$820, end of year net operating capital = \$890, beforeâ€tax operating income = \$160, and tax rate = 40%. If the firm's tax and finance methods of depreciation are the same and \$15 of depreciation was deducted in the computation of the beforeâ€tax operating income, what is this firm's free cash flow?

This question is basically belongs to Finance as well as it explains about calculating operating income before tax and free cash flow of the firm.

Total Word Count 27

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