Cash Flow Statement Test

Result

Cash Flow Statement Test - 22

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Weekly Quiz Competition

Question 1
1 / -0

Interest paid on bank overdraft will come in ___________.

A
Investment activities

B
financing activities

C
Both finance and investing activities

D
Less in operating activities

Solution

Interest paid on debentures will come under Financing Activities as bank overdraft is a financial activity.
Question 2
1 / -0

Purchase of shares or debentures are concerned with________.

A
Financing Activities

B
Operating Activities

C
Both Operating Activities and Financing Activities

D
Investing Activities

Solution

Purchase of shares or debentures are concerned with investing activities. It means a firm is investing in other firm’s shares or debentures as an Investment.
Question 3
1 / -0

______ are highly liquid assets that can be converted into cash shortly.

A
Inventories

B
Cash Equivalents

C
Loose Tools

D
Non-current Investments

Solution

Cash Equivalents are highly liquid assets which can be converted into cash in a very short period of time. These are as well as Cash.
Question 4
1 / -0

Cash Flow from Operating activities + Cash flow from investing activities + Cash flow from financing activities =?

A
Net Increase/Decrease in Non-current Assets

B
Net Increase/Decrease in Share Capital

C
Net Increase/Decrease in cash & cash equivalents

D
Net Increase/Decrease in Long term borrowings

Solution

After calculating cash flows from different three activities, they are added to know the net increase or decrease in cash and cash equivalents.
Question 5
1 / -0

Decrease in the Preference Share Capital means -----------.

A
Proceeds from Preference shares

B
No change in Preference share capital

C
Redemption of Preference Shares

D
Issue of Preference Shares

Solution

Decrease in the Preference Share Capital means redemption of preference shares. It is an outflow of cash and financing activity.
Question 6
1 / -0

Refund of income tax is the part of __________.

A
Financing Activities

B
Investing Activities

C
Both Investing Activities and Financing Activities

D
Operating Activities

Solution

Refund of income tax is the part of operating activities in Cash Flow Statement. Income tax paid (net of tax refund) is shown as an Operating activity separately.
Question 7
1 / -0

Is payment for purchase of fixed assets will be classified as operating activity for both finance and non – finance company?

A
No these are investing activities

B
No these are financing activities

C
Yes these are Operating activities

D
Not to be recorded

Solution

Purchase of fixed assets will be classified as investing activity for both finance and non – finance company. As fixed Assets are Non Current Investment.
Question 8
1 / -0

Computer Software is classified under:

A
Fixed Intangible Assets

B
Current Liabilities

C
Long, term borrowings

D
Fixed tangible Assets

Solution

Computer software is an intangible asset for a company which is shown under Non-Current Assets sub, head fixed intangible assets.
Question 9
1 / -0

Sale of Copyrights is concerned with_______.

A
Investing Activities

B
Operating Activities

C
Financing Activities

D
Both Operating Activities and Financing Activities

Solution

Sale of copyrights is concerned with Investing activities. It is added in Investing activities as proceeds from the sale of copyrights (Assets).
Question 10
1 / -0

Value of copyrights was Rs.68,000 in the year 31st March 2015 but after one year on 31st March 2016 value of copyrights was Rs.1,00,000. How it will effect cash flow statement?

A
Less Rs. 32,000 in investing activities

B
Add Rs. 1,00,000 in investing activities

C
Less Rs.1,00,000 in investing activities

D
Add Rs. 32,000 in investing activities

Solution

Increase in the value of copyrights means company has purchased copyrights (Non Current Assets). So Less Rs. 32,000 in investing activities.

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Re-Attempt Weekly Quiz Competition

Cash Flow Statement Test - 22

Result

Cash Flow Statement Test - 22

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Question 1

Investment activities

financing activities

Both finance and investing activities

Less in operating activities

Solution

Question 2

Financing Activities

Operating Activities

Both Operating Activities and Financing Activities

Investing Activities

Solution

Question 3

Inventories

Cash Equivalents

Loose Tools

Non-current Investments

Solution

Question 4

Net Increase/Decrease in Non-current Assets

Net Increase/Decrease in Share Capital

Net Increase/Decrease in cash & cash equivalents

Net Increase/Decrease in Long term borrowings

Solution

Question 5

Proceeds from Preference shares

No change in Preference share capital

Redemption of Preference Shares

Issue of Preference Shares

Solution

Question 6

Financing Activities

Investing Activities

Both Investing Activities and Financing Activities

Operating Activities

Solution

Question 7

No these are investing activities

No these are financing activities

Yes these are Operating activities

Not to be recorded

Solution

Question 8

Fixed Intangible Assets

Current Liabilities

Long, term borrowings

Fixed tangible Assets

Solution

Question 9

Investing Activities

Operating Activities

Financing Activities

Both Operating Activities and Financing Activities

Solution

Question 10

Less Rs. 32,000 in investing activities

Add Rs. 1,00,000 in investing activities

Less Rs.1,00,000 in investing activities

Add Rs. 32,000 in investing activities

Solution

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