Question

Marigold’s Pest Control Products has the following information available: net income, $15800; cash provided by operations, $21700; cash sales, $65200; capital expenditures, $10100; and dividends paid, $3500. What is Marigold’s free cash flow?

Answer 1

Answer:

The Maigold's free cash flow can be calculated using the below formula:

Cash Provided by Operations-Capital expenditure-Dividends paid

Explanation:

Cash provided by operations   $21700

Capital expenditure                  ($10100)

Dividends paid                          ($3500)

Free cash flow of Maigold's     $8100