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X Inc. expects net cash flow from operating activities to be $ 110 comma 000​, and the company plans purchases of equipment of $ 80 comma 000 and repurchases of stock of $ 18 comma 000. What is Duckalo's
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X Inc. expects net cash flow from operating activities to be $ 110 comma 000​, and the company plans purchases of equipment of $ 80 comma 000 and repurchases of stock of $ 18 comma 000. What is Duckalo's free cash​ flow?

User Chris Page
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Answer: Duckalo's free cash​ flow = $30,000

Given:

Net cash flow from operating activities = $110,000​

Purchases of equipment = $80,000

Repurchases of stock = $18,000

We can compute free cash flow as :

Free cash flow = Net cash provided by operating activities - cash payments for planned investments in long-term assets - cash dividends

Free cash flow = $110,000 - $80,000 - $0 =$ 30,000

User Alex Stewart
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