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Accounts Receivable Arising from Sales to Customers Amounted to $40000

question 73

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Accounts receivable arising from sales to customers amounted to $40000 and $55000 at the beginning and end of the year respectively. Income reported on the income statement for the year was $180000. Exclusive of the effect of other adjustments the cash flows from operating activities to be reported on the statement of cash flows is


Definitions:

Free Cash Flow

Free cash flow is a financial performance measure that calculates how much cash a company generates after accounting for capital expenditures necessary to maintain or expand its asset base.

Net Operating Profit After Taxes (NOPAT)

A measure of a company's operating efficiency, calculated as its operating income minus taxes, assuming no financing is used.

Total Operating Capital

The sum of all capital employed in a company’s daily operations, including inventory, accounts receivable, and fixed assets.

Tax Liability

The total amount of tax that individuals or businesses are legally obligated to pay to tax authorities.

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