Which of the Following Is Not a Typical Reason for Differences

question 15

Multiple Choice

Which of the following is not a typical reason for differences between profit and cash flow?

• A) Depreciation expense
• B) Income taxes
• C) Changing levels of accounts receivable
• D)Accrual accounting practices

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Definitions:

Incremental Sales

The additional revenue generated from a specific business action or decision, beyond the existing sales level.

Discount Factor

A financial metric used to determine the present value of a future cash flow, discounting it for risk and the time value of money.

After-Tax Discount Rate

A rate used in capital budgeting that takes into account the effects of taxes on the project's cash flows.

Straight-Line Depreciation

A strategy for apportioning the cost of a solid asset over its period of utility in uniform annual portions.