Jacobi Industries produced the following income statement in 2007: Other financial data for the firm for 2006 and 2007 were as follows: Calculate Jacobi's free cash flow from operations for 2007.

Question

Jacobi Industries produced the following income statement in 2007:  Other financial data for the firm for 2006 and 2007 were as follows:  Calculate Jacobi's free cash flow from operations for 2007.

Quizplus · Accepted Answer

To calculate free cash flow from operations, we need to use the formula:

Free Cash Flow from Operations = Cash Flow from Operations - Capital Expenditures

From the financial data provided, we can see that Cash Flow from Operations for 2007 is $235,730 and Capital Expenditures for the same year is $137,100. So, plugging in these values into the formula, we get:

Free Cash Flow from Operations = $235,730 - $137,100 = $98,630

Therefore, the best choice is A, with the calculation shown in the explanation.

Jacobi Industries Produced the Following Income Statement in 2007