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Commerce
Cash Flow
Quiz 1
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Q.1
Which one of the following ISN’T a way of cash outflow?
Purchasing goods & services
Paying wages, salaries and expenses
Paying creditors
Borrowing money from external sources
Q.2
If a cashflow forecast suggests that a firm will run out of cash, which would help the problem?
purchase more fixed assets
repay a bank loan
pay suppliers immediately
delay paying suppliers
Q.3
The future plan of all money transactions for a specific time frame
cash flow statement
cash flow projection
Q.4
Which accounting standard is applicable while preparing a cash flow statement ?
AS-4
AS-3
AS-3(Revised)
Schedule III
Q.5
While preparing a cash flow statement business activities are classified into ?
03 categories
06 categories
04 categories
02 categories
Q.6
Cash Flow Statement is based upon
Cash basis of accounting
Accrual basis of accounting
Credit basis of accounting
None of the above
Q.7
Which of the following statements are false?A) Cash Flow Statement is helpful in the formation of policies.B) Cash Flow Statement is useful for external analysisC) Cash Flow Statement is helpful in estimating future cash flow
Both A and B
Both A and C
Both B and C
None of the above
Q.8
Which one of the following is an example of an outflow?
Capital
Bank Loan
Wages
Government Grant
Q.9
How much cash is received from the investment of a business owner, cash received from a bank loan, and the cash paid for a bank loan.
Operating Activities
Financing Activities
Investing Activities
Q.10
How much cash a business generates from selling a non-current asset or how much they spend to acquire a non-current asset
Operating Activities
Financing Activities
Investing Activities
Q.11
How much cash a business generates from it's core business operations - selling products or services
Operating Activities
Financing Activities
Investing Activities
Q.12
Money received from a business investor would be an example of
cash inflow
cash outflow
Q.13
The amount of cash moving into and out of a business
Cash Flow
Net Worth
Q.14
Purchasing an asset would be an example of
cash inflow
cash outflow
Q.15
Ideally, the net cash flow should be
positive
negative
Q.16
Shows the total change in cash from operating, investing, and financing activities
Beginning Cash Balance
Net Cash Flows
Ending Cash Balance
Q.17
The term _________ describes how efficiently an asset can be converted intocash.
Liquidity
Solvency
Conversion rate
Working capital cycle
Q.18
Assume a firm sells goods costing £40,for £55,It provides the customerwithtrade credit (i.e. the customer pays onlyof the price as a downpayment). The profit earned is __________, and the cash received is _________.
£15,000, £12,000
£15,000, £16,500
£15,000, £28,000
£15,000, £55,000
Q.19
Cash inflows less than cash outflows =
Positive cash flow
Insolvency
Q.20
What is the purpose of a cash flow forecast?
To calculate profit or loss
To find out whether a business has enough cash to pay their bills
To find out when customers are going to pay their invoices
To see if the business will break even
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