Cash flow can be very different from profit due to which of the following?
A) Some sales are made on a credit basis and not paid for until the next reporting period.
B) Not all bills from suppliers are paid immediately, depending on cash reserves.
C) Some expenses such as depreciation do not involve the payment of cash.
D) All of the answers are correct.
E) None of the answers apply.

Question

Quizplus · Accepted Answer

Cash flow differs from profit because sales on credit, delayed payments to suppliers, and non-cash expenses like depreciation all affect cash flow without immediately impacting profit.

Cash Flow Can Be Very Different from Profit Due to Which