Which of the following statements is not correct?
A) The cash flow statement is a summary of the firm's cash receipts and disbursements over a specified period.
B) Traditional cash flow equals net income plus cash expenses.
C) Cash flow from operations equals traditional cash flow less the increase in net working capital.
D) Free cash flow equals cash flow from operations less capital expenditures.

Question

Quizplus · Accepted Answer

Traditional cash flow does not equal net income plus cash expenses. It equals net income plus non-cash expenses (such as depreciation) plus or minus changes in working capital.

Which of the Following Statements Is Not Correct