THEORY OF CONSTRAINTS Definition

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THEORY OF CONSTRAINTS is a management approach that focuses on identifying and relaxing the constraints that limit an organizations ability to reach a higher level of goal attainment.

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FREE CASH FLOW is net income plus non-cash charges to income, specifically depreciation and amortization less capital expenditures, to sustain the basic business. Free cash flow per share is a measure of the amount of cash per share a business generates after expenditures for equipment or buildings. Free cash flow is available to be used for expansion, dividends, reduction in debt, or other purposes. Free cash flow is valued more than just about any other measure, including earnings (EPS). Cash assists companies to expand, develop new products, stock buy back, pay dividends, or reduce debt. Many analysts focus on free cash flow for insight into the core of a company's cash-generating engine.

UNDERRECORDED normally refers to an understatement as to what a total would be if all data was accurately included or considered; e.g. underrecorded costs, revenues, population, etc.

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