Which of the Following Equations Is Not Correct

question 14

Multiple Choice

Which of the following equations is not correct?

• A) Potential cash flow = Net income - Non-cash revenues + Non-cash expenses
• B) Potential cash flow = Cash revenues - Cash expenses
• C) Potential cash flow = Net income + Non-cash revenues - Non-cash expenses
• D) Cash flows from operating activities = Net income + Depreciation expense + Amortization expense + Depletion expense + Provision expense - Reversal of provision - Gain on sale of fixed assets + Loss on sale of fixed assets +/- Changes in inventories,receivables,and payables

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Definitions:

Output

The total amount of goods or services produced by a company or country.

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, typically characterized by a reduction in average costs with increased production.

Minimum Efficient Scale

The smallest scale of production a firm can achieve while still taking full advantage of economies of scale in terms of costs per unit.

Output

The quantity of goods or services produced by a firm, sector, or economy within a certain period.