Cash Flow Statement Test

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Cash Flow Statement Test - 15

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Weekly Quiz Competition

Question 1
1 / -0

On an accounting statement of cash flows an "increases(decrease) in cash and cash equivalent" appears as ________________.

A
A cash flow from operating activities

B
A cash flow from investing activities

C
A cash flow from financing activities

D
None of the above

Solution

Cash and cash equivalent are the amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kind of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they presents insignificant risk of changes in value because of changes in interest rates.
Question 2
1 / -0

A building standing in the books at Rs. $$40,000$$ was sold for Rs. $$52,000$$. The profit on sale of building was transferred to profit & loss account thus increasing the net profit to Rs. $$1,80,000$$. What is the fund from operation?

A
Rs. $$1,80,000$$

B
Rs. $$1,92,000$$

C
Rs. $$1,68,000$$

D
Rs. $$1,82,000$$

Solution

Net Profit 1,80,000
Less : Profit on Sale (12,000)
(Non-trading Profit)
_____________
Fund From operation 1,68,000
_____________

Working Notes:
Calculation of Profit on Sale of Building:
Sales Value 52,000
Less: Book Value (40,000)
________
Profit on Sale 12,000
________
Question 3
1 / -0

When Gross Profit Rs. $$5,00,000$$, Wages Rs. $$10,000$$, Cost of Goods sold Rs. $$3,00,000$$, Rent paid Rs. $$25,000$$, Salaries paid Rs. $$1,00,000$$, Commission be allowed Rs. $$3,000$$, Discount allowed Rs. $$2,000$$, Provision for doubtful debts Rs. $$5,000$$, Provision for legal damages Rs. $$3,000$$, Provision for taxation Rs. $$1,50,000$$, Provision for depreciation Rs. $$50,000$$ and Refund of tax Rs. $$2,000$$, then the amount of funds from operations is __________.

A
Rs. $$3,60,000$$

B
Rs. $$3,57,000$$

C
Rs. $$3,54,000$$

D
Rs. $$3,62,000$$

Solution

Funds from operations
$$=$$ Gross Profit $$-$$ Operating Expenses
(excluding depreciation)
$$=$$ Rs. $$5,00,000-($$Rs. $$25,000+$$Rs. $$1,00,000+$$Rs.$$ 3,000+$$Rs. $$2,000+$$Rs. $$5,000+$$Rs. $$3,000)$$
$$=$$Rs. $$3,62,000$$.
Question 4
1 / -0

Given that assets Rs.$$20,00,000$$
Tax Rs. $$25,000$$
Profit before tax Rs. $$2,25,000$$
Net worth Rs. $$10,00,000$$
What is the Return on Equity (ROE)?

A
$$10\%$$

B
$$12.5\%$$

C
$$20\%$$

D
$$25\%$$
Question 5
1 / -0

Which one of the following combination of rules stands true while preparing schedule of changes in working capital?
(A)An increase in current assets increase working capital.
(B)An increase in current assets decrease working capital.
(C)An increase in current liabilities decreases working capital.
(D)An increase in current liabilities increase working capital.

A
(A) and (D)

B
(A) and (C)

C
(B) and (C)

D
(C) and (D)

Solution

Financial leverage can be measured in
A
Stock term
B
Flow term
C
Both (A) and (B)
D
None of the above
Question 6
1 / -0

Which of the following are non-operating incomes?
(i) Sale of merchandise
(ii) Interest income
(iii) Dividend income
(iv) Profit on the sale of old asset ____________.

A
i, ii & iii

B
i, ii & iv

C
ii, iii & iv

D
i, iii & iv
Question 7
1 / -0

The difference between cash flow statement and cash budget is/are __________________.

A
Cash flow statement shows the movement of cash whereas cash budget portrays no cash movement.

B
Cash flow statement is a part of cash budget

C
Cash budget shows the cash movement of the future period in contrast to cash flow statement where it displays the cash movement of the past period.

D
All of the above

E
Both (B) and (C) above

Solution

Cash flow statements analyzes cash transactions which have already occured whereas cash budget shows the cash movement of the future period.
Question 8
1 / -0

Which of the following is not a cash inflow?

A
Purchase of fixed asset

B
Sale of fixed asset

C
Issue of debentures

D
Cash from business operations
Question 9
1 / -0

A surplus in BOP means

A
Increase in loans

B
Outflow of income

C
Inflow of income

D
None of the above
Question 10
1 / -0

Cash Management and Insurance are chief function of the ____________.

A
Tax Manager

B
Controller

C
Treasurer

D
Accountant

E
Finance Manager

Solution

The treasurer of an organization deals with the liquid assets of the firm and his responsibilities include cash management and insurance of assets.

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Re-Attempt Weekly Quiz Competition

Given that assets	Rs.$$20,00,000$$
Tax	Rs. $$25,000$$
Profit before tax	Rs. $$2,25,000$$
Net worth	Rs. $$10,00,000$$

Financial leverage can be measured in
A Stock term
B Flow term
C Both (A) and (B)
D None of the above

Cash Flow Statement Test - 15

Result

Cash Flow Statement Test - 15

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SHARING IS CARING

Question 1

A cash flow from operating activities

A cash flow from investing activities

A cash flow from financing activities

None of the above

Solution

Question 2

Rs. $$1,80,000$$

Rs. $$1,92,000$$

Rs. $$1,68,000$$

Rs. $$1,82,000$$

Solution

Question 3

Rs. $$3,60,000$$

Rs. $$3,57,000$$

Rs. $$3,54,000$$

Rs. $$3,62,000$$

Solution

Question 4

$$10\%$$

$$12.5\%$$

$$20\%$$

$$25\%$$

Question 5

(A) and (D)

(A) and (C)

(B) and (C)

(C) and (D)

Solution

Question 6

i, ii & iii

i, ii & iv

ii, iii & iv

i, iii & iv

Question 7

Cash flow statement shows the movement of cash whereas cash budget portrays no cash movement.

Cash flow statement is a part of cash budget

Cash budget shows the cash movement of the future period in contrast to cash flow statement where it displays the cash movement of the past period.

All of the above

Both (B) and (C) above

Solution

Question 8

Purchase of fixed asset

Sale of fixed asset

Issue of debentures

Cash from business operations

Question 9

Increase in loans

Outflow of income

Inflow of income

None of the above

Question 10

Tax Manager

Controller

Treasurer

Accountant

Finance Manager

Solution

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