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    Free Cash Flow and Importance to a Business

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    Explain free cash flow and its importance to a business.

    © BrainMass Inc. brainmass.com October 10, 2019, 5:23 am ad1c9bdddf
    https://brainmass.com/business/statement-of-cash-flows/free-cash-flow-importance-business-503235

    Solution Preview

    Step 1
    Free cash flow is the cash that a company has left after it has defrayed all its expenses. The expenses include cost of investments. Free cash flow is an excellent indicator of the health of the business. Free cash flow is the cash flow available for distribution among all security holders of the organization (a).

    Step 2
    Free cash flow is important to businesses because it indicates the freedom with which a business can grow and pay ...

    Solution Summary

    This solution explains free cash flow. The sources used are also included in the solution.

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