Free cash flow Dillin Inc. reported the following on the company's statement of cash flows in 20Y2 and 20Y1: Free cash flow 20Y2 Net cash flow from operating activities $474,800 Net cash flow used for investing activities (426,000) Net cash flow used for financing activities (40,000) Eighty percent of the net cash flow used for investing activities was used for the purchase of property, plant, and equipment. a. Determine Dillin's free cash flow for both years. 20Y2 20Y1 20Y1 $455,400 (378,000) (57,000) b. Has Dillin's free cash flow improved or declined from 20Y1 to 20Y2?
Free cash flow Dillin Inc. reported the following on the company's statement of cash flows in 20Y2 and 20Y1: Free cash flow 20Y2 Net cash flow from operating activities $474,800 Net cash flow used for investing activities (426,000) Net cash flow used for financing activities (40,000) Eighty percent of the net cash flow used for investing activities was used for the purchase of property, plant, and equipment. a. Determine Dillin's free cash flow for both years. 20Y2 20Y1 20Y1 $455,400 (378,000) (57,000) b. Has Dillin's free cash flow improved or declined from 20Y1 to 20Y2?
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter6: Cash And Internal Control
Section: Chapter Questions
Problem 6.2E
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Transcribed Image Text:Free cash flow
Dillin Inc. reported the following on the company's statement of cash flows in 20Y2 and 20Y1:
20Y2
20Y1
Net cash flow from operating activities
$474,800
$455,400
Net cash flow used for investing activities
(426,000)
(378,000)
Net cash flow used for financing activities
(40,000)
(57,000)
Eighty percent of the net cash flow used for investing activities was used for the purchase of property, plant, and equipment.
a. Determine Dillin's free cash flow for both years.
Free cash flow
20Y2
$
20Y1
b. Has Dillin's free cash flow improved or declined from 20Y1 to 20Y2?
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