Question 1

In the funds flow statement, item of preliminary expenses written off during the year is:

Accepted Answer

A) Added to net profit 
B) Subtracted from net profit 
C) An application of working capital 
D) None of the above

Question 2

The Head Office Account maintained by the branch is of the nature of

Accepted Answer

A) Real Account 
B) Personal Account 
C) Nominal Account 
D) None of the above

Question 3

Interest on fixed deposit received by enterprise is shown in the Cash Flow Statement under

Accepted Answer

A) Operating Activities 
B) Investing Activities 
C) Financing Activities 
D) All of the Above

Question 4

Which of the following transactions result in flow of funds?

Accepted Answer

A) Cash paid to creditors 
B) Payment of bills payable 
C) Issue of shares 
D) Cash collected from debtors

Question 5

Which one of the following concepts is used as fund in the preparation of funds flow statement?

Accepted Answer

A) Current Assets 
B) Working Capital 
C) Cash 
D) All financial resources

Question 6

Buy back of equity shares should be recorded in the final cash flow statement under:

Accepted Answer

A) Investing activities 
B) Financing activities 
C) Operation activities 
D) Any of the above

Question 7

Up to the trial balance, the accounting arrangements for a foreign branch are exactly the same as for any

Accepted Answer

A) Dependent branch 
B) Independent branch 
C) Both a and b 
D) None of the above

Question 8

Funds Flow Statement is also known as_______.

Accepted Answer

A) Statement of Funds Flow 
B) Statement of Sources and Application of Funds 
C) Statement of Sources and Uses of Funds 
D) All of the above

Exam 50: Accounting Arrangements and Operations for Branches

In the funds flow statement, item of preliminary expenses written off during the year is: