Which of the following is not an example of a cash flow from operations?
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A. B. C. D.Explanation
Operating activities include the cash effects of transactions and other events that enter into the determination of net income. All of the responses apply.
The correct answer is A. none of these answers is correct.
Cash flow from operations (also known as operating cash flow) represents the cash generated or used by a company's core business operations. It reflects the inflows and outflows of cash directly related to the day-to-day operations of the business.
Let's analyze each option to understand why A is the correct answer and the other options represent examples of cash flows from operations:
B. Cash received from customers: This is a typical example of cash flow from operations. It represents the cash received by a company from its customers for the sale of goods or services. It is a fundamental component of a company's operating activities.
C. Cash paid for merchandise: This is also an example of a cash flow from operations. It represents the cash outflow by a company to purchase inventory or merchandise for sale. It is directly related to the company's core business operations and is considered an operating cash flow.
D. Cash paid for taxes: This is another example of a cash flow from operations. It represents the cash outflow by a company to fulfill its tax obligations. Taxes, such as income taxes, are an operating expense and are considered part of a company's operating activities.
Since all three options (B, C, and D) represent cash flows from operations, the correct answer is A. none of these answers is correct. This means that all the given options are examples of cash flows from operations.