Account class 12 Cash Flow Statements

1. Cash equivalents are short term, highly liquid investments that are readily convertible into known amount of cash and which are subject to insignificant change in value.

2. Operating activities are the principal revenue producing activities oif an enterprise and those activities which are not investing or financing activities.

3. Share issued to promoters in consideration of their services are shown as financing activity.

4. Gratuity paid to a retiring employees is an operating activity.

5. Income tax paid is always shown as operating activity.

6. Dividend paid is always shown as operating activity.

7. Issue of bonus shares is shown as financing activity.

8. Debenture issued for consideration other than cash is shown as inflow under financing activity.

9. Depreciation and amortization and added to net profit before tax and extra ordinary items, they being non cash expense.

10. Preliminary expenses paid during the year are added to net profit before tax and extra ordinary items and shown as outflow under financing activity.

11. Dividend received by other than financial enterprise is shown in cash flow statements under ;

12. Dividend received by financial enterprise is shown in cash flow statements under ;

13. Payment of income tax is shown as ;

14. Dividend paid by a  financial company is shown in cash outflow under ;

15. Dividend paid by non financial company is shown as ;

16. Which of the following is shown under financing activity?

17. Which of the following is part of cash and cash equivalents?

18. Which of the following is not a part of cash and cash equivalents?

19. Which of the following is not added as non cash expenses?

20. Refer to Q. 10, calculate gain on sale of machinery.

21. Refer to Q. 10, calculate the amount of purchase of machinery.

22. Which of the following is not a non cash transaction ?

23. From the following which one is a non cash transaction?