Which of the following is not true about net operating cash flow?
A)It is the difference between cash receipts and cash disbursements from providing goods and services.
B)It is a measure used in accrual accounting and is recognized as the best predictor of future operating cash flows.
C)Over short periods of time, it may not be indicative of long-run cash-generating ability.
D)It is easy to understand and all information required to measure it is factual.

Question

Quizplus · Accepted Answer

Net operating cash flow is not a measure used in accrual accounting; it is a cash basis measure. Accrual accounting uses net income as a predictor of future cash flows, not net operating cash flow.

Which of the Following Is Not True About Net Operating