🏫 Board📒 Accountancy

Cash Flow Statement

12 Board Accountancy previous year questions on Cash Flow Statement — options free on every question; 1 include the answer & explanation free, the rest unlock with PYQ Pass.

Q1 FREE PREVIEW

Which of the following is not operating expenses ?

a

Advertisement

b

Loss on sale of car

c

Salary

d

Distribution Expenses

✓ Correct answer: b)

Loss on sale of car

Explanation

Correct Answer: B) Loss on Sale of Car

Why this option is correct?

Loss on sale of car arises from sale of a fixed asset, which is not related to normal business operations.
Therefore, it is not an operating expense.

Why other options are wrong? (English)

A) Advertisement
Advertisement is a regular business expense, so it is an operating expense.

C) Wages/Salary
Salary is paid for day-to-day operations, so it is an operating expense.

D) Distribution Expense
Distribution expenses are incurred to sell goods, so they are also operating expenses.

Q2

Which of the following is not a cash inflow ?

a

Sale of fixed assets

b

Purchase of fixed assets

c

Issue of debenture

d

Sale of goods for cash

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Q3

Which one of the following is a cash item ?

a

Cash Sale

b

Depreciation

c

Goodwill written off

d

Provision for Bad-debt

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Q4

Identify the cash transaction from the following :

a

Purchase of machinery by issue of preference shares

b

Redemption of Debentures by issuing equity shares

c

Issue of Debentures as collateral security

d

Purchase of land by taking loan

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Q5

An example of cash flow from financing activities is

a

Sale of goods

b

Sale of investment

c

Cash receipt from issue of shares

d

Interest received

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Q6

Cash equivalents refers to :
(A) Demand deposits with Bank
(B) Bills receivables
(C) Treasury bill
(D) Commercial Paper
(E) Marketable Securities

Choose the correct answer from the options given below :

a

(A), (C), (D) and (E) only

b

(A), (B), (C) and (D) only

c

(A), (B), (D) and (E) only

d

(B), (C), (D) and (E) only

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Q7

Which of the following is considered as cash equivalent ?

a

Treasury Bill

b

Trade Bill

c

Liquid short term Investments

d

All of the above

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Q8

Calculate and state the nature of activity under cash flow statement:
Acquired Machinery for ₹ 5,00,000 paying 50% by cheque and executing a bond for the balance payable :

a

Inflow operating activity ₹ 2,50,000

b

Outflow Investing activity ₹ (5,00,000)

c

Inflow Investing activity ₹ (5,00,000)

d

Outflow Investing activity ₹ (2,50,000)

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Q9

Which of the following is not an application of cash ?

a

Increase in Debtors

b

Increase in Creditors

c

Increase in Stock

d

Increase in prepaid expenses

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Q10

While preparing the Cash Flow Statement, the 'cash purchase of building' will be classified as

a

Operating activity

b

Financing activity

c

Investing activity

d

None of these

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Q11

Cash Flow Statement is prepared from

a

Balance Sheet

b

Profit & Loss A/c

c

Additional information

d

All of these

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Q12

Pick the odd one out while Calculating Cash Flow from Financing Activities :

a

Issue of Shares

b

Repayment of Bank Loan

c

Redemption of Debentures

d

Rent received

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