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13. Assume you are analyzing a firm and find the following in the most recent fiscal year: Net income = $3,000; CFO = $5,400; CFI
13. Assume you are analyzing a firm and find the following in the most recent fiscal year: Net income = $3,000; CFO = $5,400; CFI = -$2,450; CFF = -2,000. Which of the following might you reasonably conclude? It is a bad sign that net income is not closer in value to CFO It is a good sign that CFF is negative It is a good sign that CFO is sufficient to cover CFI 14. Suppose you are looking at an indirect statement of cash flows and see that the first two line items listed after net income are depreciation and loss on sale of equipment. Which of the following statements would be most accurate about these two? Depreciation would be subtracted from net income in this case because it's a noncash item The loss on the sale of equipment would be added back in this case because it is a noncash item O Both items would be subtracted from net income because they are noncash items
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