Computation of net cash flow

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Reference no: EM139833

Computation of net cash flow.

An analyst has collected the following information for Gilligan Grocers:

• Earnings before interest and taxes (EBIT) = $700 million.

• Earnings before interest, taxes, depreciation and amortization (EBITDA) = $850 million.

• Interest expense = $200 million.

• The corporate tax rate is 40%.

• Depreciation is the company's only non-cash expense or revenue.

What is the company's net cash flow?

a) $850 million

b) $650 million

c) $570 million

d) $450 million

e) $500 million

Reference no: EM139833

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