Question #19
Reading: Reading 13 Integration of Financial Statement Analysis Techniques
PDF File: Reading 13 Integration of Financial Statement Analysis Techniques.pdf
Page: 9
Status: Correct
Correct Answer: C
Question
Cash generated from operations (CGO) is least appropriately calculated as:
Answer Choices:
A. EBIT + non-cash charges − increase in working capital
B. operating cash flow + cash interest paid + cash taxes paid
C. net income − cash flow from operations − cash flow from investing
Explanation
The following is an appropriate formula for calculating cash flow based accruals, not
CGO: cash flow based accruals = net income − cash flow from operations − cash flow from
investing.