Which of the following is/are not true?
A)Revenues from sales of goods or services to customers during a particular period do not necessarily equal cash received from customers during the same period.
B)The receipt of cash can precede, coincide with, or follow the recognition of revenue.
C)Expenses incurred to generate revenues during a particular period do not necessarily equal cash expended for the goods and services consumed in operations during the same period.
D)The expenditure of cash can precede, coincide with, or follow the recognition of expenses.
E)The net income for a particular period will likely equal the cash flow from operations for the same period.

Question

Quizplus · Accepted Answer

Net income is calculated using accrual accounting, which recognizes revenues and expenses when they are earned or incurred, regardless of when the cash is received or paid. Cash flow from operations, on the other hand, reflects the actual cash inflows and outflows from the company's operations during a particular period. Therefore, net income does not necessarily equal cash flow from operations.

Which of the Following Is/are Not True