Which One of the Following Is Generally Used as the Basis

question 89

Multiple Choice

Which one of the following is generally used as the basis for computing the cash flow per share?

• A)operating cash flow
• B)investment cash flow
• C)financing cash flow
• D)net cash increase
• E)retained cash earnings

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Definitions:

Compound Interest

Interest earning mechanism in which the calculation includes interest on the original principal and on all previously earned interest of a loan or deposit.

Present Value

Present Value is the current worth of a future sum of money or stream of cash flows given a specified rate of return.

Earnings Rate

The return on an investment or project expressed as a percentage of the cost, often used to measure profitability.

Present Value Factor

A multiplier used to determine the present value of a future cash flow, taking into account a specific discount rate.