Other things held constant, which of the following alternatives would increase a company's cash flow for the current year?

Question

Quizplus · Accepted Answer

a.Lengthening depreciable lives would lower depreciation, increase taxable income and taxes, and thus lower cash flow.
b.Paying down accounts payable would use cash and thus reduce cash flow.
c.Reducing the DSO would require collecting receivables faster, which would indeed increase cash flow.
d.Decreasing accruals would lower cash flow.
e.Reducing inventory turnover would mean increasing inventories, which would use cash.

Other Things Held Constant, Which of the Following Alternatives Would