Question 1

Goods purchased for cash. This transaction involves…………..

Accepted Answer

A)  flow of fund
B)  no flow of fund
C)  both of these
D)  none of these B

Question 2

…………….assets are those which in the ordinary course of business can be converted into cash within a short period of time.

Accepted Answer

A)  current
B)  non current
C)  both of these
D)  none of these A

Question 3

Which among the following asset is excluded from current assets ?

Accepted Answer

A)  loose tools
B)  accounts receivable
C)  short term investments with bank
D)  finished goods A

Question 4

……………….means cash and other assets which are expected to be sold or consumed during the normal operating cycle of business.

Accepted Answer

A)  liquid assets
B)  quick assets
C)  cash equivalents
D)  current assets

Question 5

……………..means excess of current assets over current liabilities.

Accepted Answer

A)  working capital
B)  gross working capital
C)  net working capital
D)  all of these

Question 6

Which of the following results in Increase of working capital ?

Accepted Answer

A)  increase in current assets
B)  decrease in current assets
C)  increase in current liabilities
D)  all of these

Question 7

Net profit earned plus non working capital expenses is equal to …………..

Accepted Answer

A)  fund provided by operations
B)  use of funds
C)  sinking fund
D)  none of these

Question 8

Fund flow refers to changes in ------------- capital

Accepted Answer

A)  fixed
B)  working
C)  both of these
D)  none of these

Question 9

………..liabilities are those which are intended to be paid in the ordinary course of business within a short period.

Accepted Answer

A)  current
B)  non current
C)  both of these
D)  none of these

Question 10

Which among the following do not result in the flow of fund

Accepted Answer

A)  depreciation of fixed assets
B)  goodwill written off
C)  transfer to general reserve
D)  all of these

Question 11

While preparing ……………statement, both capital and revenue items are considered.

Accepted Answer

A)  fund flow statement
B)  income statement
C)  both of these
D)  none of these

Question 12

Fund lost in operations represent………………..

Accepted Answer

A)  inflow of funds
B)  outflow of funds
C)  neither inflow nor outflow
D)  none of these

Question 13

…………statement shows changes in financial position and hence dynamic in nature

Accepted Answer

A)  fund flow statement
B)  balance sheet
C)  income statement
D)  none of these

Question 14

Decrease in Working capital constitutes …………………

Accepted Answer

A)  source of fund
B)  application of funds
C)  neither source nor application
D)  none of these

Question 15

The flow of funds occurs when a transaction changes on the one hand a non current account and on the other hand a …………..

Accepted Answer

A)  current asset
B)  current liability
C)  a or b
D)  none of these

Question 16

…………….is the dividend paid to the members of a company during a financial year before the finalization of annual accounts.

Accepted Answer

A)  bonus
B)  final dividend
C)  interim dividend
D)  none of these

Question 17

……………….refers to firms investment in current assets.

Accepted Answer