Estill Corporation had the following financial data at year-end: Cash flows from operating activities $52,500 Cash...
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Estill Corporation had the following financial data at year-end:
Cash flows from operating activities $52,500 Cash flows from investing activities 7,000 Cash flows from financing activities 12,000 Cash used to purchase property, plant, and equipment 14,280 Sales 550,275
What is Estill Corporation's ratio of free cash flow to sales?- 1.0%
- 6.0%
- 6.9%
- 9.2%
Homework Answers
Answer : C = 6.9 %
>> Free cash flows = Cash flows from Operating Activity - Capital expenditure
>> Free cash flows = $ 52,500 - $ 14,280
>> Free cash flows = $ 38,220 .
>> Free cash flow to Sales Ratio = ( $ 38,200 * 100 ) / $ 550,275
>> Free cash flow to Sales Ratio = 6.94 %
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