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Financial Reporting & Analysis
Financial Reporting & Analysis
Hard
Thorndale Corp. reports rising net income over three years ($120M, $135M, $155M) while CFO declines ($180M, $160M, $110M). Further analysis reveals receivables grew 40% while revenue grew only 15%. This pattern most likely indicates:
A
Aggressive revenue recognition practices inflating reported earnings
B
Conservative accounting that understates current profitability
C
A normal pattern for a high-growth technology company
D
Effective working capital management reducing cash tied up in operations
Select an answer to continue
Tags
#cash-flow-quality
#earnings-manipulation
#receivables
#red-flags
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