Analysts who follow Howe Industries recently noted that,relative to the previous year,the company's operating net cash flow increased,yet cash as reported on the balance sheet decreased.Which factor could explain this situation?

Question

Quizplus · Accepted Answer

The increase in operating net cash flow indicates that the company generated more cash from its core business activities. However, the decrease in cash on the balance sheet suggests that the company may have invested in a new plant or made some other investment that reduced the overall cash balance. Option B is the only choice that suggests a possible explanation for this situation.

Analysts Who Follow Howe Industries Recently Noted That,relative to the Previous