Cash Flow From Investing & Financing Activities - MCQs

Cash Flow From Investing & Financing Activities - MCQs


1. Which of the following are cash flow from investing activities?

A) Interest received
B) Dividend received
C) Sale of fixed assets
D) Purchase of fixed assets

a) Both A and B
b) Both A and C
c) Both B and C
d) A, B, C and D

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ANSWER: d) A, B, C and D



2. Which of the following are cash flow from financing activities?

A) Interest received
B) Dividend received
C) Interest paid
D) Dividend paid

a) Both A and B
b) Both A and C
c) Both C and D
d) A, B, C and D

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ANSWER: c) Both C and D



3. Acquisition and disposal of long term assets is included in

a) Cash flow from investing activities
b) Cash flow from financing activities
c) Cash flow from operating activities
d) None of the above

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ANSWER: a) Cash flow from investing activities



4. Which of the following statements represent example of cash flow from investing activities?

a) Cash advances and loans made by financial enterprises
b) Cash advances and loans made to third parties
c) Both a and b
d) None of the above

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ANSWER: b) Cash advances and loans made to third parties



5. ABC Ltd had investment of Rs 68,000 as on 31.3.2013 and investment of Rs 56,000 as on 31.3.2014. During the year ABC Ltd sold 40% of its investments being held in the beginning of period at a profit of Rs 16,800. Determine cash flow from investing activities.

a) Rs 59,200
b) Rs 28,800
c) Rs 72,800
d) None of the above

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ANSWER: b) Rs 28,800



6. Financing activities brings changes in

a) Size and composition of owner’s equities
b) Borrowing of the enterprise
c) Both a and b
d) None of the above

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ANSWER: c) Both a and b



7. For year 2013 Equity Share Capital is Rs 3,00,000 Preference Share Capital is 1,00,000 10% debentures is 2,00,000 and Share premium is 30,000. For year 2014 Equity Share Capital is Rs 4,00,000 Preference Share Capital is 60,000 10% debentures is 1,00,000 and Share premium is 40,000. Also given, Dividend paid on shares Rs 15,000 and Interest paid on debentures RS 20,000. Determine net cash flow from financing activities.

a) Cash inflow of Rs 65,000
b) Cash outflow of Rs 65,000
c) Cash inflow of Rs 56,000
d) Cash outflow of Rs 56,000

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ANSWER: b) Cash outflow of Rs 65,000


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