When Reconciling Net Income to Net Cash Provided by Operating

question 184

Multiple Choice

When reconciling net income to net cash provided by operating activities, a(n) _ is an addition to net income.

• A) increase in wages payable
• B) increase in accounts receivable
• C) increase in inventories
• D) All of these answers are correct.

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Definitions:

Asset-specific Risk

The risk that affects the value of a particular asset, such as changes in its market or sector, distinct from market-wide risk.

Unsystematic Risk

The risk associated with an individual asset or investment, distinct from market-wide risks.

Risk-free Rate of Return

The theoretical return on an investment with zero risk, typically based on government bonds.

Time Value

The idea that having money presently is more valuable than possessing an identical sum later on because of its capacity to generate earnings.