{"id":54317,"date":"2024-04-16T00:08:07","date_gmt":"2024-04-16T00:08:07","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=54317"},"modified":"2024-04-16T00:08:07","modified_gmt":"2024-04-16T00:08:07","slug":"fl-is-zero-if","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/","title":{"rendered":"FL is zero if:"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;EBIT = Interest&#8221; option2=&#8221;EBIT = Zero&#8221; option3=&#8221;EBIT = Fixed Cost&#8221; option4=&#8221;EBIT = Pref. Dividend&#8221; correct=&#8221;option1&#8243;]<!--more--><\/p>\n<p>The correct answer is A. EBIT = Interest.<\/p>\n<p>FL stands for Free Cash Flow. It is the cash flow that is available to the company after taking into account all of its operating expenses, interest payments, and taxes.<\/p>\n<p>EBIT stands for Earnings Before Interest and Taxes. It is the profit that a company makes before taking into account interest and taxes.<\/p>\n<p>If EBIT is equal to interest, then the company is making just enough profit to cover its interest payments. In this case, there will be no free cash flow, as all of the company&#8217;s profit will be used to pay interest.<\/p>\n<p>The other options are incorrect because they do not take into account interest payments. If EBIT is zero, then the company is making no profit. If EBIT is equal to fixed costs, then the company is making just enough profit to cover its fixed costs. If EBIT is equal to preferred dividends, then the company is making just enough profit to cover its preferred dividends. In all of these cases, there will be no free cash flow, as all of the company&#8217;s profit will be used to cover its expenses.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;EBIT = Interest&#8221; option2=&#8221;EBIT = Zero&#8221; option3=&#8221;EBIT = Fixed Cost&#8221; option4=&#8221;EBIT = Pref. Dividend&#8221; correct=&#8221;option1&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-54317","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>FL is zero if:<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"FL is zero if:\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;EBIT = Interest&#8221; option2=&#8221;EBIT = Zero&#8221; option3=&#8221;EBIT = Fixed Cost&#8221; option4=&#8221;EBIT = Pref. 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Dividend&#8221; correct=&#8221;option1&#8243;]","og_url":"https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2024-04-16T00:08:07+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"1 minute"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/","url":"https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/","name":"FL is zero if:","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2024-04-16T00:08:07+00:00","dateModified":"2024-04-16T00:08:07+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"breadcrumb":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/exam.pscnotes.com\/mcq\/fl-is-zero-if\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/exam.pscnotes.com\/mcq\/"},{"@type":"ListItem","position":2,"name":"Financial management","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/financial-management\/"},{"@type":"ListItem","position":3,"name":"FL is zero if:"}]},{"@type":"WebSite","@id":"https:\/\/exam.pscnotes.com\/mcq\/#website","url":"https:\/\/exam.pscnotes.com\/mcq\/","name":"MCQ and Quiz for Exams","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/exam.pscnotes.com\/mcq\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209","name":"rawan239","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","caption":"rawan239"},"sameAs":["https:\/\/exam.pscnotes.com"],"url":"https:\/\/exam.pscnotes.com\/mcq\/author\/rawan239\/"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/54317","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/comments?post=54317"}],"version-history":[{"count":0,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/54317\/revisions"}],"wp:attachment":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/media?parent=54317"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/categories?post=54317"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/tags?post=54317"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}