Cigna Corporation's 2010 net income is smaller than net cash flow from operating activities. Which of the following would not be an explanation of why net income is smaller than net cash flow from operating activities?
A) Cigna paid dividends to shareholders during 2010.
B) Cigna's accounts payable increased during 2010.
C) Cigna recognized depreciation expense in 2010.
D) Cigna sold equipment at a loss in 2010.

Question

Quizplus · Accepted Answer

Dividends paid do not affect net income or operating cash flow, as they are financing activities.

Cigna Corporation's 2010 Net Income Is Smaller Than Net Cash