Which one of the following is consistent with a company recording a large operating loss but still having healthy cash flows from operations?

Question

Quizplus · Accepted Answer

A large amount of depreciation and/or amortization expense is a non-cash item that reduces operating income but does not affect cash flows from operations. Therefore, a company can have a large operating loss due to these expenses but still have healthy cash flows from operations.

Which One of the Following Is Consistent with a Company