If a company's net income is increasing, but its cash flows from operating activities are decreasing, a possible cause is that the company is
1. making substantial expenditures on new equipment
2. using substantial amounts of cash to pay off its loans
3. increasing its inventory at a faster rate than its sales revenue
4. suffering from an excessive amount of depreciation on old equipment
If a company's net income is increasing, but its cash flows from operating ...
Solution helps in understanding the cause of net income is increasing but cash flows from operations are decreasing