Sharma (1996)suggests That a Cash-Flow Based Measure of Retained Cash

question 10

Multiple Choice

Sharma (1996) suggests that a cash-flow based measure of retained cash flows from operations (RCFFO) may be an important indicator of financial flexibility.How is RCFFO measured?

• A) The level of cash retained, calculated by deducting net cash flows from investing from the net cash flows from operations.
• B) The level of cash retained after meeting all operating costs and priority payments such as interest costs and dividends.
• C) The level of cash retained after meeting all operating costs and deducting or adding as appropriate the cash flows from financing and investing activities.
• D) The level of cash retained, calculated by deducting net cash flows from financing from the net cash flows from operations.
• E) None of the given answers.

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