This year a company generated $1,000,000 in cash from its operating activities, and had a $250,000 increase

Question:

This year a company generated $1,000,000 in cash from its operating activities, and had a $250,000 increase in cash from its investment activities. It also spent $600,000 on capital expenditures. What was the amount of the company’s free cash flow this year?

a. $650,000

b. $150,000

c. $1,350,000

d. $1,850,000

Free Cash Flow
Free cash flow (FCF) represents the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. Unlike earnings or net income, free cash flow is a measure of profitability that excludes the...