easy · Financial Accounting assets

A firm reports Net Income of $100,000 but its Cash Flow from Operations is only $40,000.

Which situation most likely explains this low quality of earnings?

  1. Significant repayments of Long-Term Debt
  2. A large increase in Accounts Receivable and Inventory
  3. Issuance of new Common Stock
  4. High levels of Depreciation and Amortization

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