Home › Finance › Operating Margin Formula › Chapter Volume Profit Relationships Solutions Questions Operating Margin Formula Gross Ratio Calculator Core High Products Accounting Double Leverage Business Equation Noi

Finance / July 14, 2018 / Alicia Franklin

FCF measures the level of cash available to a company's investors net of all required investments in working capital and fixed capital, including plant, property and equipment, otherwise known as capital expenditures, plus any expenses required to remain a going concern. FCF is an important measure because it allows a company to pursue opportunities that enhance shareholder value. Excess cash can expand production, develop new products, make acquisitions, pay dividends and reduce debt.

Cumulative interest is the sum of all interest payments made on a loan over a certain time period. On an amortizing loan, cumulative interest will increase at a decreasing rate, as each subsequent periodic payment on the loan is a higher percentage of the loan’s principal and a lower percentage of its interest.

89 out of 100 based on 708 user ratings

We Also Think You’ll Like