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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Question
Ee.65.

Transcribed Image Text:Free cash flow
Dillin Inc. reported the following on the company's statement of cash flows in 20Y2 and 20Y1:
20Y2
20Y1
Net cash flow from operating activities
$477,000
Net cash flow used for investing activities
(430,000)
Net cash flow used for financing activities
(43,000)
Eighty percent of the net cash flow used for investing activities was used for the purchase of property, plant, and
a. Determine Dillin's free cash flow for both years.
Free cash flow
20Y2
$456,600
(377,000)
(56,000)
20Y1
b. Has Dillin's free cash flow improved or declined from 20Y1 to 20Y2?
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