Question

During 2017, Ecuyer Industries reported cash provided by operations of $794,000, cash used in investing of $686,000, and cash used in financing of $190,000. In addition, cash spent for fixed assets during the period was $276,000. Average current liabilities were $650,000 and average total liabilities were $1,716,000. No dividends were paid. Based on this information, what was Ecuyer's free cash flow?

Answer 1

$518,000

Step-by-step explanation:

Data provided in the question:

cash provided by operations = $794,000

Cash used in investing = $686,000

Cash used in financing = $190,000

cash spent for fixed assets during the period = $276,000

Average current liabilities = $650,000

Average total liabilities = $1,716,000

Now,

Ecuyer's free cash flow

Particulars Amount

Cash provided by operations $794,000

Less: Cash spent for fixed assets during the period $276,000

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Ecuyer's free cash flow $518,000