Question: A financial statement that shows the inflows and outflows of cash during a particular period of time is known as
- a) Statement of cash flows
- b) Income statement
- c) Statement of retained earnings
- d) Balance sheet
Answer: Statement of cash flows
Question: A company who issues bonds or stocks in result raised funds which finally
- a) Increases cash
- b) Decreased cash
- c) Increased liabilities
- d) Increased equity
Answer: Increases cash
Question: In a statement of cash flows, a company investing in short-term financial investments and in fixed assets results in
- a) Decreased cash
- b) Increased cash
- c) Increased liabilities
- d) Increased equity
Answer: Decreased cash
Question: Which of the following is not a cash outflow
- a) Increase in creditors
- b) Increase in Prepaid expenses
- c) Increase in debtors
- d) Increase in stock
Answer: Increase in creditors
Question: Which of the following is not a cash inflow
- a) Decrease in creditors
- b) Decrease in debtors
- c) Issue of shares
- d) Sale of fixed assets
Answer: Decrease in creditors
Question: When a fixed asset is bought as hire purchase, interest element is classified under ______ and loan element is classified under________.
- a) Financing activities, investing activities
- b) Operating activities, financing activities
- c) Investing activities, operating activities
- d) All of the options
Answer: Financing activities, investing activities
Question: In case of other enterprises cash flow arising from interest paid should be classified as cash flow from ________ while dividends and interest received should be stated as cash flow from ____
- a) Financing activities, investing activities
- b) Operating activities, financing activities
- c) Investing activities, operating activities
- d) All of the options
Answer: Financing activities, investing activities
Question: In the case of financial enterprises, the cash flow resulting from interest and dividend received and interest paid should be classified as cash flow from
- a) Operating activities
- b) Financing activities
- c) Investing activities
- d) All of the options
Answer: Operating activities
Question: Listed Enterprises need to prepare Cash Flow Statement only
- a) Indirect method
- b) Direct method
- c) Average method
- d) All of the options
Answer: Indirect method
Question: As per AS-3, Cash Flow Statement is mandatory for
- a) Companies listed on a stock exchange and Companies with a turnover of more than Rs 50 crores
- b) Companies listed on a stock exchange
- c) Companies with a turnover of more than Rs 50 crores
- d) None of the options
Answer: Companies listed on a stock exchange and Companies with a turnover of more than Rs 50 crores
More Questions...........................
Question: For the calculation of cash flow from operating activities, payments and receipts shown in Profit & Loss account are converted into payments and receipts actually in cash by eliminating
- a) Non-cash revenue from the revenue earned and Non-cash expenses from expenses incurred
- b) Non-cash revenue from the revenue earned
- c) Non-cash expenses from expenses incurred
- d) None of the options
Answer: Non-cash revenue from the revenue earned and Non-cash expenses from expenses incurred
Question: Which of the following are cash flow from operating activities
- a) Cash Receipts from customers and Cash Paid to Supplier and Employees
- b) Cash Receipts from customers
- c) Cash Paid to Supplier and Employees
- d) None of the options
Answer: Cash Receipts from customers and Cash Paid to Supplier and Employees
Question: _________ reconciles the opening cash balance with the closing cash balance of a given period on the basis of net decrease or increase in cash during that period.
- a) Cash Flow Statement
- b) Funds Flow Statement
- c) Both
- d) None of the options
Answer: Cash Flow Statement
Question: Cash flow statement is based upon _________ while Funds Flow Statement recognizes _______.
- a) Cash basis of accounting, accrual basis of accounting
- b) Accrual basis of accounting, cash basis of accounting
- c) Both are based on cash basis of accounting
- d) All of the options
Answer: Cash basis of accounting, accrual basis of accounting
Question: The objectives of Cash Flow Statement are
- a) All of the options
- b) Analysis of cash position
- c) Short-term cash planning
- d) Comparison of operating Performance
Answer: All of the options
Question: Cash Flow Statement is also known as
- a) Statement of Changes in Financial Position on Cash basis
- b) Only inflow of cash
- c) Only outlow of cash
- d) None of the options
Answer: Statement of Changes in Financial Position on Cash basis
Question: As per Accounting Standard-3, Cash Flow is classified into
- a) Operating activities, financing activities and investing activities
- b) Operating activities and investing activities
- c) Investing activities and financing activities
- d) Operating activities and financing activities
Answer: Operating activities, financing activities and investing activities
Question: Redemption of preference Shares is concerned directly with
- a) Financing Activities
- b) Investing Activities
- c) Operating Activities
- d) All of the options
Answer: Financing Activities
Question: Sale of machinery is concerned with_________
- a) Investing Activities
- b) Financing Activities
- c) Operating Activities
- d) All of the options
Answer: Investing Activities
Question: Proposed Dividend is classified under
- a) Short term provisions
- b) Reserves and Surplus
- c) Non-current Liabilities
- d) Long term provisions
Answer: Short term provisions
Question: Financing activities brings changes in
- a) Size and composition of owners equities and Borrowing of the enterprise
- b) Size and composition of owners equities
- c) Borrowing of the enterprise
- d) None of the options
Answer: Size and composition of owners equities and Borrowing of the enterprise
Question: ABC Ltd had investment of Rs 68,000 as on 31.3.2013 and investment of Rs 56,000 as on 31.3.2014. During the year ABC Ltd sold 40% of its investments being held in the beginning of period at a profit of Rs 16,800. Determine cash flow from investing activities.
- a) Rs. 28,800
- b) Rs. 59,200
- c) Rs. 72,800
- d) All of the options
Answer: Rs. 28,800
Question: Which of the following statements represent example of cash flow from investing activities?
- a) Cash advances and loans made to third parties
- b) Cash advances and loans made by financial enterprises
- c) Both
- d) None of the options
Answer: Cash advances and loans made to third parties
Question: Acquisition and disposal of long term assets is included in
- a) Cash flow from investing activities
- b) Cash flow from financing activities
- c) Cash flow from operating activities
- d) All of the options
Answer: Cash flow from investing activities
Question: Which of the following are cash flow from financing activities
- a) Interest paid and Dividend paid
- b) Interest paid
- c) Dividend paid
- d) None of the options
Answer: Interest paid and Dividend paid
Question: Which of the following are cash flow from investing activities
- a) All of the options
- b) Interest received
- c) Dividend received
- d) Sale of fixed assets
Answer: All of the options
Question: In indirect method, net cash flow from operating activities is calculated on the basis of
- a) Net profit before tax
- b) Net Profit after tax
- c) Gross Profit after tax
- d) Gross Loss after tax
Answer: Net profit before tax
Question: Given salary expenses Rs 40,000, Outstanding in the beginning of the year: Rs 5,000 and outstanding at the end of the year Rs 10,000. Cash outflow on salary will be
- a) Rs. 35000
- b) Rs. 45,000
- c) Rs. 55,000
- d) Rs. 15,000
Answer: Rs. 35000
Question: The amount of operating expenses which are actually been paid in cash are shown under
- a) Cash outflow on expenses
- b) Cash flow from sales
- c) Cash outflow on purchases
- d) All of the options
Answer: Cash outflow on expenses
Question: While preparing Cash Flow Statement, non-cash items and non-operating items are not required to be adjusted under________
- a) Direct method
- b) Indirect method
- c) Average method
- d) All of the options
Answer: Direct method