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Free cash flow

Free cash flow is a measure of a company's financial performance that indicates how much cash it is generating from its operations after accounting for the purchase of assets, such as property, plant, and equipment. It is calculated by subtracting a company's capital expenditures from its operating cash flow.Free cash flow is an important metric for investors, as it shows how much cash a company has available to pay dividends, repurchase its own stock, pay off debt, or invest in new opportunities. A company with positive free cash flow is able to fund its ongoing operations and growth without having to rely on additional borrowing or selling new equity.

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The Restaurant Business An Accounting Guide

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