A company paid out $1,000,000 in dividends to shareholders in the most recent fiscal year while also increasing the retained earnings by $2,000,000. In addition, it paid out $500,000 in interest to creditors, recognized $1,500,000 in depreciation expense, and incurred $750,000 in capital expenditures. The company had current assets totalling $3,000,000 at the beginning of the year and $3,500,000 at the end of the year. The company's current liabilities were $2,400,000 at the beginning of the year and $2,750,000 at the end of the year. What is this company's free cash flow for the most recent fiscal year?
A company paid out $1,000,000 in dividends to shareholders in the most recent fiscal year while also increasing the retained earnings by $2,000,000. In addition, it paid out $500,000 in interest to creditors, recognized $1,500,000 in depreciation expense, and incurred $750,000 in capital expenditures. The company had current assets totalling $3,000,000 at the beginning of the year and $3,500,000 at the end of the year. The company's current liabilities were $2,400,000 at the beginning of the year and $2,750,000 at the end of the year. What is this company's free cash flow for the most recent fiscal year?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A company paid out $1,000,000 in dividends to
shareholders in the most recent fiscal year while
also increasing the retained earnings by
$2,000,000. In addition, it paid out $500,000 in
interest to creditors, recognized $1,500,000 in
depreciation expense, and incurred $750,000 in
capital expenditures. The company had current
assets totalling $3,000,000 at the beginning of the
year and $3,500,000 at the end of the year. The
company's current liabilities were $2,400,000 at
the beginning of the year and $2,750,000 at the end
of the year. What is this company's free cash flow
for the most recent fiscal year?
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