Which of the Following Statements Is CORRECT

question 32

Multiple Choice

Which of the following statements is CORRECT?

• A)Operating cash flow (OCF) is defined as follows: OCF = EBIT(1-T) - Depreciation and Amortization.
• B)Changes in working capital have no effect on free cash flow.
• C)Free cash flow (FCF) is defined as follows: FCF = EBIT(1 - T)
• + Depreciation and Amortization
• - Capital expenditures required to sustain operations
• - Required changes in net operating working capital.
• D)Free cash flow (FCF) is defined as follows: FCF = EBIT(1-T)+ Depreciation and Amortization + Capital expenditures.
• E)Operating cash flow is the same as free cash flow (FCF).

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Definitions:

Shares Of Stock

Represents units of ownership interest in a corporation or financial asset, providing a distribution of profits in the form of dividends.

Partnership Certificates

Documents issued by a partnership that certify ownership of a share in the partnership's profits, losses, and assets.

Incorporated Cooperative

A business entity recognized by law, composed of individuals who collaborate towards mutual economic, social, and cultural interests.

Business Trust

A legal arrangement in which trustees manage assets for the benefit of beneficiaries, often used in business for tax or estate planning.