Earnings before interest, taxes depreciation and amortization provides a measure

Question

Earnings before interest, taxes depreciation and amortization provides a measure of the company's free cash flow. True or False?

A public company would rather have zero depreciation so that it does not have to pay taxes. True or False?

Refers to spreading out the capital expenses a business incurs for tangible assets. True or False?

A private company would rather depreciate assets over a longer period of time so that they can keep earnings higher as they are valued by the metric EPS or earnings per share. True or False?

Explanation / Answer

1. Earnings before interest, taxes depreciation and amortization provides a measure of the company's free cash flow. False

False

True

True

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