Question

Cash from operating activities consists of ______.

Options

• Operating Profit

• Decrease/Increase in Current Assets

• Decrease/Increase in Current Liabilities

• All of the Above

Answer 1

Cash from operating activities consists of operating profit, decrease/increase in current assets, and decrease/increase in current liabilities.

Explanation:

Cash from operating operations includes operating profit after adjustments for changes in current assets and current liabilities. Cash decreases when current assets rise and increases when current assets fall. In the same way, cash rises as current liabilities rise and it falls when they fall. As a result, cash from operational activities includes all of the alternatives.