Selected information (in U.S. $ millions) for Google Inc. and Microsoft Corp. for 2015 and 2016, respectively,
Question:
Selected information (in U.S. $ millions) for Google Inc. and Microsoft Corp. for 2015 and 2016, respectively, follows:
________________________________________________Google............Microsoft
Net cash provided by operating activities..........$26,024..........$33,325
Net capital expenditures.........................................9,915...........23,950
Dividends paid............................................................-0-...........11,006
Instructions
(a) Calculate the free cash flow for each company. Which company has the better free cash flow? Why?
(b) Why do you think Microsoft has paid out dividends while Google has not?
Free Cash FlowFree cash flow (FCF) represents the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. Unlike earnings or net income, free cash flow is a measure of profitability that excludes the...
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a USD millions Google Microsoft Free cash flow 26024 99150 16109 33325 23950 11006 1631 Although Mic...View the full answer
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Related Book For 
Financial Accounting Tools for Business Decision Making
ISBN: 978-1119368458
7th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
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