Question 2 1 pts The term free cash flow is often referred t

Question 2 1 pts The term free cash flow is often referred to as a financial statement ratio. O a non-IFRS financial measure O an IFRS performance measure. O an IFRS financial measure.

Solution

Answer 2:

b. a non-IFRS financial measure.

Explanation:

Free cash flow is the amount of cash left after paying capital expenditures from cash flow from operations. So, it is the net cash after paying out all the expenses.

The non-IFRS financial measures are generally used by management to examine the underlying performance of business operations. In addition, they may not indicate historical operating results, nor are predict future results. But these are considered significant supplemental measures of performance as this a way to evaluate a company’s operating performance and liquidity.

Answer 9:

b. $ 1,584,000

Explanation:

Sales 2017: $ 1,800,000.   {60% on account, so 40% on cash}.

Cash sales amount = $ 1,800,000 X 40% = $ 720,000

Account sales amount = $ 1,800,000 X 60% = $ 1,080,000

Out of account sales 80% of amount is collected= $ 1,080,000 X 80% = $ 864,000

Cash collected from customers in 2017

= Cash sales + Amount collected on account sales

= $ 720,000 + $ 864,000

=$ 1,584,000