Which of the following would result in Company B adding more to its cash at the end of the year than Company A, assuming all else is the same for them.
a) B has a larger proportion of customer sales that become accounts receivable than A
b) B may depreciate its equipment faster than A
c) B pays more dividends than A
d) B has a smaller proportion of customer sales that become accounts receivable than A
e) B may depreciate its equipment more slowly than A
f) B pays less dividends than A
Answer:
b) B may depreciate its equipment faster than A
d) B has a smaller proportion of customer sales that become accounts receivable than A
f) B pays less dividends than A
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