Question

Cash flow from assets is defined as: Multiple Choice the cash flow to shareholders minus the cash flow to creditors. cash flow to shareholders minus net capital spending plus the change in net working capital. operating cash flow plus net capital spending plus the change in net working capital. operating cash flow minus the change in net working capital minus net capital spending. operating cash flow plus the cash flow to creditors plus the cash flow to shareholders.

Answer 1

Answer:

d. Operating cash flow minus the change in net working capital minus net capital spending.

Explanation:

Cash flow from assets = Operating cash flow - Change in Net Working Capital  - Net capital spending

--> Operating cash flow = EBIT + Depreciation - Taxes

--> Net Capital spending = Ending Net fixed assets - Beginning net fixed assets + Depreciation,

--> Change in Net Working Capital = Ending Net Working Capital - Beginning Net Working Capital