Aubey Aircraft recently announced that its net income increased sharply from the previous year, yet its net cash flow from operations declined. Which of the following could explain this performance?

Question

Quizplus · Accepted Answer

A decline in depreciation and amortization expenses would increase net income (since these are non-cash expenses), but it would not affect cash flow from operations, potentially leading to a situation where net income increases while cash flow from operations declines.

Aubey Aircraft Recently Announced That Its Net Income Increased Sharply