1)Which statement is correct?

Select one:

a.

The statement of comprehensive income, the balance sheet and the cash flow statement are accrual based

b.

The statement of comprehensive income is accrual based and the balance sheet and the cash flow statement are cash based.

c.

The balance sheet does not record cash.

d.

The statement of comprehensive income and the balance sheet are accrual based and the cash flow statement is cash based.

2)

Select the statement that is NOT true.

Select one:

a.

A bank overdraft is an example of "cash equivalent".

b.

The concept of cash underpinning the cash flow statement is "cash and cash equivalents".

c.

If a firm is operating profitably it will automatically have plenty of cash.

d.

Cash is an important asset as it is the means by which claims are usually settled.