Net Income for a Particular Period Will Likely Differ from Cash

question 92

True/False

Net income for a particular period will likely differ from cash flow from operations for the same period.

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Definitions:

Investing Activities

Transactions and events related to the acquisition and disposal of long-term assets and investments, reported in the cash flow statement.

Hedging

A maneuver or contract that eliminates risk from a transaction. In international trade, eliminating exchange rate risk by purchasing a forward contract for delivery of foreign exchange at a specified rate at a specified time.

Settlement Date

The day when a trade is finalized, and the buyer must pay for the securities.

Floating Exchange Rate

A currency's value is allowed to fluctuate according to the foreign exchange market without direct government control.