What is implied if the accounts payable account has decreased?
A) Cash flow from financing activities has decreased relative to net income.
B) Cash flow from operating activities has increased relative to net income.
C) Cash flow from operating activities has decreased relative to net income.
D) Cash flow from financing activities has increased relative to net income.

Question

Quizplus · Accepted Answer

A decrease in accounts payable implies that the company has paid off some of its outstanding liabilities, which would result in a cash outflow, thereby decreasing cash flow from operating activities relative to net income.

What Is Implied If the Accounts Payable Account Has Decreased