![]() ![]() To figure CapEx, take the value of the company’s property, plant and equipment (PP&E) from the current year or other period. A line item for CapEx is found in a company’s cash flow statement. ![]() It may include land, buildings, equipment, machinery, vehicles and the like. ![]() CapEx consists of expenditures used to acquire assets that will be useful beyond the current tax year. Operating expenses consist of costs such as employee wages and salaries, rent, utilities, insurance, repairs and supplies that are necessary to keep the business running.Īfter calculating operating cash flow, determine capital expenditures (CapEx). To figure operating cash flow, subtract operating expenses from total sales. Free cash flow = operating cash flow – capital expendituresĬalculating free cash flow starts with figuring operating cash flow.
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