Question

Which of the following does not create a difference between net income and the net cash...

Which of the following does not create a difference between net income and the net cash flow from operations?

(a)Non-operating gains and losses

(b) Payment of a cash dividend

(c)Depreciation expense

(d)Timing differences between credit sales and collections from customers

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Answer #1

(b) Payment of cash dividend

The payment of cash dividend does not affect the net income.

Dividends paid is not an operational activity and as such it does not affect net cash flow from operations.

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