The business plans to spend $107,000 to purchase equipment. What is the expected amount of free cash flow for 2018?
Murphy & Murphy Enterprises expects the following for 2018:
A) $109,000
B) $125,000
C) $76,000
D) $60,000
A) $109,000
Explanation: Free cash flow = Net cash provided by operating activities - Cash payments planned for investments in long-term assets - Cash dividends
Free cash flow = $232,000 - $107,000 - $16,000
Free cash flow = $109,000
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