In Using the Information on the Statement of Cash Flows

question 49

Multiple Choice

In using the information on the statement of cash flows while obtaining an understanding of a profitable, growing company, which of the following would ordinarily be least surprising to an auditor?

• A) Decreases in accounts payable.
• B) Decreases in accounts receivable.
• C) Negative cash flows from investing.
• D) Negative operating cash flows.

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Definitions:

Degrees Of Freedom

The count of distinct values or amounts that may change in a study without breaking any restrictions.

Chi-squared Test

The Chi-squared test is a statistical test used to compare observed data with data expected under a specific hypothesis, often used for testing relationships between categorical variables.

Normality

A property of a dataset or distribution where the data follow a normal (Gaussian) distribution.

Preference

An indication of someone's choice or likeliness for a particular option among a set of alternatives, often studied in consumer behavior and decision-making.