Cash Flow Ratios Tracy Company reports the following amounts in its annual financial statements31,000*Capital expenditures.(000 0Average current assets.$90,000Cash flow from operating activities.Cash flow from investing activitiesCash flow from financing activities.80,000Average current liabilitiesTotal assetsP3000(10,000)000 0Net income000 000* This amount is a cash outflow.Compute Tracy's free cash flow.a.Compute Tracy's operating-cash-flow-to-current-liabilities ratio.b.Compute Tracy's operating-cash-flow-to-capital-expenditures ratio.C.

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Asked Nov 21, 2019
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Cash Flow Ratios Tracy Company reports the following amounts in its annual financial statements
31,000*
Capital expenditures.
(000 0
Average current assets.
$90,000
Cash flow from operating activities.
Cash flow from investing activities
Cash flow from financing activities.
80,000
Average current liabilities
Total assets
P3000
(10,000)
000 0
Net income
000 000
* This amount is a cash outflow.
Compute Tracy's free cash flow.
a.
Compute Tracy's operating-cash-flow-to-current-liabilities ratio.
b.
Compute Tracy's operating-cash-flow-to-capital-expenditures ratio.
C.
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Cash Flow Ratios Tracy Company reports the following amounts in its annual financial statements 31,000* Capital expenditures. (000 0 Average current assets. $90,000 Cash flow from operating activities. Cash flow from investing activities Cash flow from financing activities. 80,000 Average current liabilities Total assets P3000 (10,000) 000 0 Net income 000 000 * This amount is a cash outflow. Compute Tracy's free cash flow. a. Compute Tracy's operating-cash-flow-to-current-liabilities ratio. b. Compute Tracy's operating-cash-flow-to-capital-expenditures ratio. C.

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Expert Answer

Step 1

a.

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Cash flow from operating activities Less: Capital expenditure Free cash flow 90,000 31000 59,000

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Step 2

b.

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Cash flow from operating activities Divided by: Average current liabilities Operating cash flow to current liabilities 90,000 60,000 1.50

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