Question

Assume that during 2020, Cypress Semiconductor Corporation reported net cash provided by operating activities of $155,410,000, net cash used in investing activities of $207,390,000 (including cash spent for plant assets of $132,895,000), and net cash used in financing activities of $33,360,000. Dividends of $4,140,000 were paid. Calculate free cash flow.

Answer 1

Answer:

$18,375,000

Explanation:

The free cash flow is determined by adding all the cash that is generated by operating activities and subtracting capital expenditures. Capital expenditures include distributed dividends and cash spent for fixed assets.  

free cash flow = $155,410,000 - ($132,895,000 - $4,140,000) = $155,410,000 - $137,035,000 = $18,375,000