Operating Cash Flow The amount of cash that can be withdrawn from a firm without

Question

Operating Cash Flow

The amount of cash that can be withdrawn from a firm without harming its ability to operate and to produce future cash flows.

Income found after subtracting all costs and expenses from revenue.

None of these

Earnings from operations before interest and taxes.

The cash generated from a firm's normal business activities.

The amount of cash that can be withdrawn from a firm without harming its ability to operate and to produce future cash flows.

Income found after subtracting all costs and expenses from revenue.

None of these

Earnings from operations before interest and taxes.

The cash generated from a firm's normal business activities.

Explanation / Answer

Option C

Operating Cash Flow = EBIT = Earnings from operations before interest and taxes.

The amount of cash that can be withdrawn from a firm without harming its ability to operate and to produce future cash flows = FCFF

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