Outdoor Lighting Supply expects the following for 2018: Net cash provided by operating activities of $\$ 284,000$
Net cash provided by financing activities of $\$ 67,000$
Net cash provided by investing activities of $\$ 76,000$
Cash dividends paid to stockholders of $\$ 29,000$ Outdoor expects to spend $150,000 to modernize its showroom.
How much free cash flow does Outdoor expect for 2018?

Question

Quizplus · Accepted Answer

Free cash flow is calculated as net cash provided by operating activities minus capital expenditures. Here, it's $\$284,000 - \$150,000 = \$134,000$. However, the correct calculation should also consider cash dividends paid, which is not typically subtracted in the standard calculation of free cash flow. Therefore, the correct calculation for the scenario provided is simply the net cash from operating activities minus the capital expenditures, leading to the answer of $\$134,000$, which is not listed correctly in the options provided based on the standard definition of free cash flow. The provided options and the question seem to have a discrepancy, but based on standard calculations, none of the options accurately reflect the correct calculation of free cash flow as commonly defined.

Outdoor Lighting Supply Expects the Following for 2018: Net Cash $284,000\$ 284,000$284,000

Outdoor Lighting Supply Expects the Following for 2018: Net Cash $\$ 284,000$