The following statements are about Free Cash Flow (FCF). Select all that are true.

a) FCF gives an indication of whether or not cash can be returned to shareholders, or use to retire debt, borrow more to grow faster or any combination of these options.

b) To interpret a firms free cash flows we need to study cash flow from operations, cash flows related to changes in working capital and cash flows related to changes in fixed assets and long-term assets.

c) We can finance free cash flows in the following ways: pay interest to its lenders, pay dividends to its shareholders, increase/decrease interest on short or long-term debt, and/or issue stock to new shareholders.

d) There is only one way to calculate free cash flow.

e) FCF is the same as Cash Flow from Assets

f) FCF takes into consideration operating cash flow, adjustments for capital spending and changes to net working capital.

g) FCF is not a part of the cash flow identity.

Match each transaction with the appropriate cash flow effect.

Financing cash outflow, financing cash inflow, investing cash outflow,operating cash inflow, operating cash outflow, investing cash inflow, no cash flow effect)

a) An increase in holdings of stocks of another company.

b) Sales of goods and services.

c) Acquiring fixed assets and purchase of debt or equity.

d) Repurchase of the firms own equity securities.

e) Sale of the firms own equity securities.

f) Payment to shareholders dividends.

g) Payment of interest to lenders and employees for services rendered.