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Why are cash flow projections primarily focused on operating cash flows rather than net income ( NI ) or accounting profits? Because operating cash flows
Why are cash flow projections primarily focused on operating cash flows rather than net income NI or accounting profits?
Because operating cash flows provide a more accurate reflection of the cash generated from the business's core operations, essential for assessing the firm's ability to sustain and grow its operations.
Because net income includes noncash expenses such as depreciation and amortization, which do not affect the company's actual cash position.
Because accounting profits are calculated based on accrual accounting, which can include revenues not yet received in cash and expenses not yet paid out, leading to a potential discrepancy between reported profits and actual cash available.
All of the above.
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