write my assignment 2139
Polygon Inc. want to increase its free cash flow (FCF) by $210 million, which should result in a higher EVA and stock price. The CFO has made these projections for the upcoming year:
– EBIT is projected to equal 850$ million
– Gross capital expenditures are expected to total 360$ million versus depreciation of 120$ mil, so its net capital expenditures should total 240$ million.
– The tax rate is 40%
-There will be no change in cash or marketable securities, nor will there be any changes in notes payable or accurals.
The question is what increase in net working capital ( in mil. dollars) would enable the firm to meet its target increase in FCF?