Provo, Inc., had revenues of $10 million, cash operating expenses of $5 million,

Q: Provo, Inc., had revenues of $10 million, cash operating expenses of $5 million,

1 answer is $ 3,400,000 Revenue $10,000,000 - Operating Ex 5,000,000 EBITDA $ 5,000,000 - D&A 1,000,000 EBIT $ 4,000,000 x (1 Revenue $10,000,000 - Operating Ex 5,000,000 EBITDA $ 5,000,000 - D&A 1,000,000 EBIT $ 4,000,000 x (1

ID: 2659669 • Letter: P

Question

Provo, Inc., had revenues of $10 million, cash operating expenses of $5 million, and depreciation and amortization of $1 million during 2008. The firm purchased $500,000 of equipment during the year while increasing its inventory by $300,000 (with no corresponding increase in current liabilities). The marginal tax rate for Provo is 40 percent.

part 1. What is Provo's cash flow from operations for 2008?

part 2. What is Provo's free cash flow for 2008?

part 3. What is Provo's NOPAT for 2008?

part 4. What is Provo's cash flows associated with investments for 2008?

Explanation / Answer

answer is $ 3,400,000

Revenue

$10,000,000

- Operating Ex

5,000,000

EBITDA

$ 5,000,000

- D&A

1,000,000

EBIT

$ 4,000,000

x (1