Question 1

The Statement of Cash Flows presentation method that separates gross cash inflows from cash outflows is known as the:

Accepted Answer

A)  equity method 
B)  direct method 
C)  set-off method 
D)  net method. 
A)  equity method 
B)  direct method 
C)  set-off method 
D)  net method.

Question 2

Bank borrowings are ordinarily classified as:

Accepted Answer

A)  operating activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management 
B)  investing activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management 
C)  financing activities, except for bank overdrafts that are repayable on demand *d financing activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management. 
D)  financing activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management. 
A)  operating activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management 
B)  investing activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management 
C)  financing activities, except for bank overdrafts that are repayable on demand *d financing activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management. 
D)  financing activities, except for bank overdrafts that are repayable on demand and which form an integral part of an entity's cash management.

Question 3

Use the following information to answer questions 
A company reported the following information for a financial year:
 $\begin{array}{lr}
\text { Profit from ordinary activities before incometax expense } & 72,000 \
\text { Income tax expense } & 20,000 \
\text { Depreciation expense } & 8,000 \
\text { Issue of shares } & 40,000 \
\text { Loan made to another company } & 6,000 \
\text { Increase in accounts receivable } & 1,000 \
\text { Decrease in inventories } & 2,000 \
\text { Cash received from loans receivable } & 4,000 \
\text { Dividends paid } & 2,000
\end{array}$
-What is the net cash inflow (outflow) from investing activities?

Accepted Answer

A)  $2000 net cash inflow 
B)  $6000 net cash inflow 
C)  $(2000) net cash outflow 
D)  $(4000) net cash outflow. 
A)  $2000 net cash inflow 
B)  $6000 net cash inflow 
C)  $(2000) net cash outflow 
D)  $(4000) net cash outflow.

Question 4

The following cash flow activities are regarded as investing cash flows:

Accepted Answer

A)  income taxes paid 
B)  interest paid 
C)  acquisition of subsidiary net of cash acquired 
D)  proceeds from issue of debentures. 
A)  income taxes paid 
B)  interest paid 
C)  acquisition of subsidiary net of cash acquired 
D)  proceeds from issue of debentures.

Question 5

Which of the following items must be separately disclosed in the Statement of Cash Flows?
I. Dividends paid
II. Interest received
III. Dividends received
IV. Interest paid
V. Auditor's remuneration paid

Accepted Answer

A)  I, II, III and IV only 
B)  II, III and IV only 
C)  I, II and V only 
D)  II, III, IV and V only 
A)  I, II, III and IV only 
B)  II, III and IV only 
C)  I, II and V only 
D)  II, III, IV and V only

Question 6

Cash flows arising from each of the following activities of a financial institution may be reported on a net basis:
I cash receipts and payments for the acceptance and repayment of deposits with a fixed maturity date
II the placement of deposits with and withdrawal of deposits from other financial institutions
III cash advances and loans made to customers and the repayment of those advances and loans
IV cash receipts and payments for the acceptance and repayment of deposits with no fixed maturity date

Accepted Answer

A)  I , II and IV 
B)  II, III and IV 
C)  I, III and IV 
D)  I, II and III. 
A)  I , II and IV 
B)  II, III and IV 
C)  I, III and IV 
D)  I, II and III.

Question 7

Cash flows arising from the following operating, investing or financing activities may be reported on a net basis when:

Accepted Answer

A)  cash receipts and payments for items in which the turnover is slow, the amounts are large, and the maturities are short 
B)  cash receipts and payments for items in which the turnover is quick, the amounts small, and the maturities are short 
C)  cash receipts and payments for items in which the turnover is quick, the amounts are large, and the maturities are short 
D)  cash receipts and payments for items in which the turnover is quick, the amounts are large, and the maturities are long-term. 
A)  cash receipts and payments for items in which the turnover is slow, the amounts are large, and the maturities are short 
B)  cash receipts and payments for items in which the turnover is quick, the amounts small, and the maturities are short 
C)  cash receipts and payments for items in which the turnover is quick, the amounts are large, and the maturities are short 
D)  cash receipts and payments for items in which the turnover is quick, the amounts are large, and the maturities are long-term.

Question 8

Brett Limited had a net profit after tax of $850 000 for the financial year. Included in this profit was:
Depreciation expense of $120 000
Gain on sale of Investments of $28 000
Also, Accounts Receivable increased by $39 000 and Inventories decreased by $12 000. The cash flow from operating activities during the year was:

Accepted Answer

A)  $731 000 
B)  $785 000 
C)  $915 000 
D)  $969 000. 
A)  $731 000 
B)  $785 000 
C)  $915 000 
D)  $969 000.

Question 9

An item or transaction will qualify for classification as a cash equivalent:

Accepted Answer

A)  if it has a remaining term of more than three months but no more than six months 
B)  its term to maturity is no greater than twelve months 
C)  it has a fixed maturity date of greater than twelve months 
D)  only if it has a maturity of less than three months. 
A)  if it has a remaining term of more than three months but no more than six months 
B)  its term to maturity is no greater than twelve months 
C)  it has a fixed maturity date of greater than twelve months 
D)  only if it has a maturity of less than three months.

Question 10

Warner Limited had the following cash flows during a reporting period:
Acquisition of subsidiary, net of cash flows $250 000
Dividends paid $65 000
Repayment of borrowings $90 000
Interest paid on borrowings $57 000
Proceeds from sale of plant $215 000
What is the amount of the cash flows in relation to financing activities of Warner Limited for the reporting period?

Accepted Answer

A)  Net cash inflow $155 000 
B)  Net cash outflow $155 000 
C)  Net cash inflow $212 000 
D)  Net cash outflow $212 000 
A)  Net cash inflow $155 000 
B)  Net cash outflow $155 000 
C)  Net cash inflow $212 000 
D)  Net cash outflow $212 000

The Statement of Cash Flows presentation method that separates gross cash inflows from cash outflows is known as the:

Bank borrowings are ordinarily classified as:

The following cash flow activities are regarded as investing cash flows:

Which of the following items must be separately disclosed in the Statement of Cash Flows? I. Dividends paid II. Interest received III. Dividends received IV. Interest paid V. Auditor's remuneration paid

Cash flows arising from the following operating, investing or financing activities may be reported on a net basis when:

An item or transaction will qualify for classification as a cash equivalent:

Accounting Regulation and the Conceptual Framework

Application of Accounting Theory

Shareholders Equity: Share Capital and Reserves

Fair Value Measurement

Revenue

Provisions, Contingent Liabilities and Contingent Assets

Income Taxes

Financial Instruments

Share-Based Payments

Translation of the Financial Statements of Foreign Entities

Employee Benefits

Inventories

Property, Plant and Equipment

Leases

Understanding Australian Accounting Standards

Impairment of Assets

Accounting for Mineral Resources

Agriculture

Financial Statement Presentation

Earnings Per Share

Operating Segments

Operating Segments

Business Combinations

Consolidation: Principles and Accounting Requirements

Consolidation: Intragroup Transactions

Consolidation: Non Controlling Interest

Joint Arrangements

Associates and Joint Ventures

Filters

Exam 20: Statement of Cash Flows

The Statement of Cash Flows presentation method that separates gross cash inflows from cash outflows is known as the:

Bank borrowings are ordinarily classified as:

The following cash flow activities are regarded as investing cash flows:

Which of the following items must be separately disclosed in the Statement of Cash Flows? I. Dividends paid II. Interest received III. Dividends received IV. Interest paid V. Auditor's remuneration paid

Cash flows arising from the following operating, investing or financing activities may be reported on a net basis when:

An item or transaction will qualify for classification as a cash equivalent:

Accounting Regulation and the Conceptual Framework

Application of Accounting Theory

Shareholders Equity: Share Capital and Reserves

Fair Value Measurement

Revenue

Provisions, Contingent Liabilities and Contingent Assets

Income Taxes

Financial Instruments

Share-Based Payments

Translation of the Financial Statements of Foreign Entities

Employee Benefits

Inventories

Property, Plant and Equipment

Leases

Understanding Australian Accounting Standards

Impairment of Assets

Accounting for Mineral Resources

Agriculture

Financial Statement Presentation

Earnings Per Share

Operating Segments

Operating Segments

Business Combinations

Consolidation: Principles and Accounting Requirements

Consolidation: Intragroup Transactions

Consolidation: Non Controlling Interest

Joint Arrangements

Associates and Joint Ventures

Filters