Discuss the correlations that have been found between net income, net income plus or minus Type 1 adjustments (i.e., adjustments to net income for revenues, expenses, gains, and losses that are recognized in income and are associated with changes in

noncurrent assets, noncurrent liabilities, and shareholders' equity, but do not affect cash by the same amounts for the period), and cash flow from operations.


The study by Robert M. Bowen, David Burgstahler, and Lane A. Daley, "Evidence on the Relationships Between Earnings and Various Measures of Cash Flow," Accounting Review (October, 1986) revealed (1) a high correlation between net income and net income plus or minus Type 1 adjustments, and (2) a low correlation between net income and cash flow from operations, and (3) a low correlation between cash flow from operations and net income plus or minus Type 1 adjustments over time

Business

You might also like to view...

Which of the following examples best represents product form competition in drip coffee machine category?

A) other brands of coffee drip machines B) percolators and espresso machines C) juicers and water purifiers D) pots and pans

Business

What are the two major functions of organizational culture imperative to an organizations survival called?

a. Environmental diversification and Internal diversification b. Internal adaptation and External integration c. Macro diversification and Micro integration d. External adaptation and Internal integration

Business

The center-of-gravity method is used primarily to determine what type of locations?

A) service locations B) manufacturing locations C) distribution center locations D) supplier locations E) call center locations

Business

________ is the maximum time that the product is allowed at each workstation

Fill in the blanks with correct word

Business