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CFA Level 1 Exam
3959 Questions
Question No. 1
While comparing a firm that expenses costs with one that capitalizes them:
I. The capitalizing firm always shows higher cash flow from operations.
II. The cumulative difference between the cash flow from operations increases over time.
III. The capitalizing firm pays lower taxes in the first year.
IV. The capitalizing firm recognizes higher deferred tax liabilities.
Choose the correct option from the given list.
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