Additional Cash flows from operations leftover after paying for replacement of existing plant,property and equipment and dividends to shareholders are:
A)Cash flows from investing.
B)Free cash flows.
C)Cash flows from financing activities.
D)Cash flows from investing activities.

Question

Quizplus · Accepted Answer

Free cash flows are the cash flows available after all necessary investments in the company's fixed assets and payment of dividends to shareholders have been made. These cash flows can be used for various purposes, including investing in new projects, paying off debt, or returning additional funds to shareholders. Therefore, the additional cash flows mentioned in the question are classified as free cash flows.

Additional Cash Flows from Operations Leftover After Paying for Replacement