Which of the Following Can a Cash Flow Analysis of the Final

question 162

Multiple Choice

Which of the following can a cash flow analysis of the final disposal of a capital asset (for example, machinery used in the operation of a business) not produce?

• A) A net cash outflow.
• B) A net cash inflow.
• C) An income tax consequence.
• D) An operating gain or loss.
• E) An after-tax cash outflow.

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Definitions:

Percent of Sales Method

A forecasting technique that estimates future financial statements based on a predicted sales growth rate and historical financial ratios.

Analysis of Receivables

The process of examining the accounts receivable of a business to assess their collectability and manage credit risk.

Accrued Interest

Interest that has been incurred but not yet paid in cash during a specific time period.

Note

A financial instrument that represents a debt or obligation between two parties, wherein the issuer promises to pay the holder a certain amount of money at a future date.