If a firm is reporting its income in accordance with generally accepted accounting principles,then its net income as reported on the income statement should be equal to its free cash flow.

Question

Quizplus · Accepted Answer

There is no reason to think that net income would be equal to FCF.For example,a company that is not growing might report zero net income yet have high FCF because of depreciation.

If a Firm Is Reporting Its Income in Accordance with Generally