MANAGENT ACCOUNTING Question And Answers
- What is the impact of sale of assets in fund flow statement?
Answer:- Sale of assets will result in source of fund in fund flow statement.
- What is the impact of sale of fixed assets in fund flow statement?
Answer:- Sale of fixed assets will result in source of fund in fund flow statement.
- What is the impact of purchase of fixed assets in fund flow statement?
Answer:- Purchase of fixed assets will result in application of fund in fund flow statement.
- What is the impact of non trading receipts in fund flow statement?
Answer:- Non trading receipts will result in source of fund in fund flow statement.
65. Name the sources of fund.
- Issue of shares for cash.
- Issue of debentures for cash.
- Raising of long-term loans.
- Sale of fixed assets on cash or credit.
- Sale of trade investments.
66. Name the applications of fund.
- Redemption of shares for cash .
- Redemption of debentures for cash.
- Payment of long-term loans.
- Purchase of fixed assets.
- Purchase of trade investments.
67. What is cash flow statement?
Answer:- A cash flow statement is a financial statement that provides aggregate data regarding all cash inflows a company receives from its ongoing operations and external investment sources, as well as all cash outflows that pay for business activities and investments during a given period.
- What are the types of cash flow activities?
Answer:- The three categories of cash flows are operating activities, investing activities, and financing activities.
- Give examples for cash flow from operating activities.
Answer:- Examples of Inflows:
- Cash collected from customers against sale of goods or rendering of services
- Cash collections from “other revenues” such as commissions, royalties, and fees
- Cash refunded against income taxes if they cannot be specifically identified with the investing or financing activities
Examples of Outflows:
- Cash paid to vendors against supply of goods or services
- Cash paid to or on behalf of employees of the entity
- Cash paid against income taxes if they cannot be specifically identified with the investing or financing activities
- Give examples for cash flow from investing activities.
Answer:- Purchase of fixed assets (negative cash flow)
Sale of fixed assets (positive cash flow)
Purchase of investment instruments, such as stocks and bonds (negative
cash flow)
Sale of investment instruments, such as stocks and bonds (positive cash
flow)
Lending of money (negative cash flow)
Collection of loans (positive cash flow)
