For a profitable firm,an increase in which one of the following will increase the operating cash flow?
A)Employee salaries
B)Office rent
C)Building maintenance
D)Depreciation
E)Equipment rental

Question

Quizplus · Accepted Answer

Depreciation is a non-cash expense that is added to net income to calculate operating cash flow. An increase in depreciation expense will reduce net income but increase operating cash flow. Therefore, an increase in depreciation will increase operating cash flow. The other options listed are all cash expenses that will decrease operating cash flow if increased.

For a Profitable Firm,an Increase in Which One of the Following