CFS
This query is : Resolved
CA Ravi Sisodia
(Querist)
26 November 2009
what the meaning of Free Cash Flow ?
How to use FCF ?
How to use FCF ?
CA. Rishabh Mittal
(Expert)
26 November 2009
Free Cash Flows, in general means the amount of cash, that a company is left with after meeting all it's cash expenses, including capital expenditures / Investments. In other word, we can say uncommitted cash flows.
FCF = Net Income as per P/L A/c + depreciation or non cash exp + amortization - /+ changes in working capital - Capital Expenditure.
Therefore, it is a cash not required for operations or further reinvestments.
USE of FCF - It is used to judge the company performance. However, now a days EVA is more preferred on FCF to judge the company performance.
FCF = Net Income as per P/L A/c + depreciation or non cash exp + amortization - /+ changes in working capital - Capital Expenditure.
Therefore, it is a cash not required for operations or further reinvestments.
USE of FCF - It is used to judge the company performance. However, now a days EVA is more preferred on FCF to judge the company performance.
CA Ravi Sisodia
(Querist)
26 November 2009
THANKS DEAR RISHABH
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Accounting treatment of AMC alongwith the purchase of Laptop
- Condonation Request sec 119(2) b -Enhancement Limit of Leave Exemption prior to AY 2023
- Issuing of delivery challan by seller of goods
- GST Treatment of Purchases with GST Paid where Outward Supplies of Manufactured CattleFeed Exempt
- Not ordinarily resident having partnership income in India and salary in USA is any form to filed be
- Nursery business
- WRONG GSTR7 ENTRIES ACCEPTED ERRONEOUSLY
- Tax on Amount transferred in HUF Account
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
