Accounting Profits and Cash Flows Are

Multiple Choice

Accounting profits and cash flows are:

A) generally the same since they reflect current laws and accounting standards.
B) generally the same since accounting profits reflect when the cash flows are received.
C) generally not the same since GAAP allows for revenue recognition separate from the receipt of cash flows.
D) generally not the same because cash inflows occur before revenue recognition.
E) Both generally not the same since GAAP allows for revenue recognition separate from the receipt of cash flows; and generally not the same because cash inflows occur before revenue recognition.