If a company reports high net income,it may still have difficulty paying its bills.

Question

Quizplus · Accepted Answer

Net income is the profit generated by a company after deducting all its expenses. However, the company's ability to pay its bills depends on its cash flow, which may not necessarily reflect its net income. A company may have high net income, but if it doesn't have enough cash to cover its expenses, it may still struggle to pay its bills. Therefore, high net income does not guarantee that a company has no difficulty paying its bills.

If a Company Reports High Net Income,it May Still Have