A Firm's Cash Flows Will Differ from Net Income Each

question 59

Multiple Choice

A firm's cash flows will differ from net income each period for all of the following reasons except:

• A) cash receipts from customers do not necessarily occur in the same period in which a firm recognizes revenues.
• B) cash expenditures to employees, suppliers, and governments do not necessarily occur in the same period in which a firm recognizes expenses.
• C) the company is sustaining losses each period.
• D) cash inflows and outflows that pertain to investing and financing activities do not immediately flow through the income statement.

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