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The president of Ferneti Company is puzzled. During the last year, the company experienced a net loss of $800,000, yet its cash increased $300,000...

The president of Ferneti Company is puzzled. During the last year, the company experienced a net loss of $800,000, yet its cash increased $300,000 during the same period of time. Explain to the president how this could occur.

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The company experience net loss yet the cash has increased, this is due to the non cash expenses shown in the profit and... View the full answer

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The profit margins of the company may be lower. The expenses... View the full answer

Net income/loss = Gross income (cash) - Expenditure In the case... View the full answer

After working on your question, I... View the full answer

Ferneti Company.docx

1 comment
  • This answer will provide you better understanding. kindly select an appropriate answer and rate the best answer
    • vjvgoe
    • May 18, 2017 at 11:25pm

Loss of $800000 and positive cash flow of $300000 is due to amount of depreciation. The reason being depreciation is the... View the full answer

1 comment
  • Best regards
    • 156whitney
    • May 19, 2017 at 12:05am

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