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Briefly describe why Zhou income and cash flow different

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Question - In 2020, Zhou, Inc. sold merchandise costing $50m for $75m on account to customers.

During 2020, Zhou, Inc. purchased merchandise for sale costing $30m and collected $70m in cash from customers.

Based solely on these facts, what would Zhou, Inc. report as income for 2020?

Based solely on these facts, what would Zhou, Inc. report as operating cash flow for 2020?

Briefly describe why Zhou's income and cash flow are different for 2020, and comment on the informativeness of these measures, including which one you would want to rely on as a potential investor in Zhou's stock if only one measure were available.

Reference no: EM132770152

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