Question 1:

The statement of cash flow classifies cash flows according to:

A. Operating and non-operating flows

B. Inflow, outflow and horizontal flows

C. Investing and non-operating flows

D. Operating, investing and financing activities

The following is an example of a cash flow from financing activities:

A. Repayment of bank loan

B. Receipt of interest on investment

C. Cash received from customers

D. Purchase of fixed asset

The following is an example of a cash flow from investment activities:

A. Cash drawings from the entity

B. Repayment of long-term loan

C. Payment of creditors

D. Sale of an equipment

The following is an example of cash flow from operating activities:

A. Purchase of equipment

B. Sale of fixed assets

C. Interest paid on investment by a bank

D. Capital contribution by the owner

Which item is classified under cash flow from financing activities in a cash flow statement?

A. Capital contribution

B. Capital withdrawals

C. Bank loan repaid

D. All the above

The return on capital is:

A. The margin that a business makes between the cost price and the selling price

B. A measure of net profit compared to capital

C. A comparison of net profit to sales

D. A measure of expenses compared to sales