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cash flow multiple choice questions

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › cash flow multiple choice questions

  • This topic has 1 reply, 2 voices, and was last updated 8 years ago by MikeLittle.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • February 22, 2017 at 6:31 pm #373722
    Nicola
    Member
    • Topics: 16
    • Replies: 6
    • ☆

    Hi Mike
    from the september 2016 exam past paper qu 11, top trades co,
    it says statement of cash flow year end 31.12.20×7
    net flow from op activities 995
    net cash used in investing activities (540)
    Net cash used in Finance (200)

    net increase in cash and cash equ 255
    cash and cash equ at start of period 200
    cash and cash equ at end of period 455

    which of the following is correct
    a company has good working capt
    b net cash generated from finance activities has been used to fund additions to n c a
    c net cash generated from operating activities used to fund additions to nca
    d exisiting non current assets sold to cover the cost of the additions to nca

    answer is c how do I answer this question is it the cash at the start equal cash at the end ?increase in net cash, I am really guessing at this one? thanks

    Aphrodite cash gen unit impairment loss
    on section b no 20 answer is $262.500 (a) looks like they have match the g/w impairment back to the cost and 35m for the damaged plant which I understand I think,
    its the remaining 100 m allocated proportionately I am struggling with a bit Many thanks for any help and clarification.

    February 22, 2017 at 7:16 pm #373735
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23311
    • ☆☆☆☆☆

    Look at these 2 options:

    “b net cash generated from finance activities has been used to fund additions to n c a
    c net cash generated from operating activities used to fund additions to nca”

    Financing activities is a negative and …

    Operating activities is a positive

    So these two statements are directly contradictory

    So one or the other must be incorrect – they cannot both be right

    Now, given that investing activities is an outflow, the activities that finance those investing activities MUST be a positive flow

    So the answer must be C – the positive flow

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    Posts
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  • The topic ‘cash flow multiple choice questions’ is closed to new replies.

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