Free cash flow is
A)equal to net income.
B)equal to net income plus taxes.
C)a term used to describe an increase in net working capital.
D)cash that is available to distribute to creditors and equity holders.
E)another term for operating cash flow.

Question

Quizplus · Accepted Answer

Free cash flow refers to the cash that a company generates after paying for capital expenditures and working capital needs. This cash is available to be distributed to creditors and equity holders. Therefore, choice D is the best answer.

Free Cash Flow Is