Increase in accounts receivable must be subtracted from revenue
adjusted for non-cash items.
Financial Reporting And Analysis MCQ - Financial Reporting And Analysis Section 2
In a common size analysis of the statement of cash flows, the items of
cash flow may be presented as a percentage of either total cash flow or
net revenue.
Cash flow is most likely negative for a growth stage company. A mature
company tends to perform well and has stable cash flows. A declining
profits company may not necessarily have negative cash flow.
Identifying the major sources and uses of cash is the first step in cash
flow statement analysis.
20
Which of the following is least likely an approach for developing commonsize cash flow statement?
