Company a Reports Sales of $100,000 and Net Income of $15,000.Company

question 131

Multiple Choice

Company A reports sales of $100,000 and net income of $15,000.Company B reports sales of $100,000 and net income of $10,000.Therefore

• A) Company A's cash flow may be higher or lower than Company B's cash flow even though A's net income is higher.
• B) Company A's cash flow is $5,000 more than Company B's cash flow.
• C) Company B is creating less value for its shareholders than Company A.
• D) Company B's accounts receivable must be higher than Company A's accounts receivable.

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