Which item may be of concern when analyzing cash ﬂow from operating activities?
A) Repayment of debt
B) Decreasing accounts receivable
C) Increasing inventories
D) Payments of dividends

Question

Quizplus · Accepted Answer

Increasing inventories can be a concern when analyzing cash flow from operating activities because it may indicate that cash is tied up in inventory rather than being available for other uses. This can impact the liquidity and operational efficiency of a business.

Which Item May Be of Concern When Analyzing Cash ﬂOw