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Kramer Corporation recently announced that its net income (EAT) was lower than last year. However, analysts estimate that the company's net cash flow (NCF) increased. What factors could explain this discrepancy

Respuesta :

jepessoa

Answer:

When you are preparing the cash flow statement, some adjustments are made that actually increase the cash flow even if the net income has decreased, for e.g.:

  • lower accounts receivables
  • lower inventories
  • higher depreciation and amortization expenses
  • higher accounts payables and accruals
  • sale of investments
  • new long term debt
  • less dividends distributed
  • new capital raised