• 1. 
    Which of the following is an example of a cash out-flow for a business?

  • payments to creditors
  • sale of goods
  • payment from debtors
  • receiving a loan from the bank
  • 2. 
    What is the formula used for a cash flow forecast?

  • [ Receipts - Payments = Net Cash Flow ] + Opening Balance = Closing Balance.
  • [ Receipts - Payments = Net Cash Flow ] - Opening Balance = Closing Balance.
  • 3. 
    What is the money available to pay for day to day operational costs called?

  • Cash
  • Working capital
  • Profit
  • ´╗┐All of the above
  • 4. 
    The closing bank balance is calculated by:

  • opening bank balance + cash out-flow
  • opening bank balance + cash in-flow
  • opening bank balance + net cash flow
  • net cash flow + gross profit
  • 5. 
    How can cash outflows be improved?

  • Buy extra equipment
  • Lease out equipment
  • Use a factoring service
  • 6. 
    Which of the following is an example of a cash in-flow for a business?

  • payment to suppliers
  • paying back a loan to a bank
  • payment from debtors
  • purchase of fixed assets
  • 7. 
    In a given cash flow forecast, the closing balance in June would become the ____________ of July.

  • Closing balance
  • Working capital
  • Net cash flow
  • Opening balance
  • 8. 
    The monthly net cash flow for a business is calculated by:

  • sales revenue - cost of goods sold
  • total cash in - total cash out
  • total cash out - total cash in
  • total cash in - cost of goods sold
  • 9. 
    What is a long term way to improve cash inflow?

  • Take out a loan
  • Take out an overdraft
  • Use a factoring service
  • 10. 
    A firm is forecast to have a negative closing bank balance. Which would reduce the problem?

  • sell more goods on 4 months credit
  • produce more goods
  • ask customers to pay in cash and not sell goods on credit
  • ask suppliers if the firm can pay for goods in cash
  • 11. 
    Which of the following reduces a businesses cash flow?

  • Asking debtors for payment
  • Repaying an overdraft
  • Securing better trade credit terms from suppliers
  • 12. 
    Which of the following is NOT a use of cash-flow forecasts?

  • They indicate how much cash is available for paying bills
  • They show how much the bank needs to lend to stop insolvency
  • They indicate whether the business is holding too much cash
  • They indicate how much profit the business will make
  • 13. 
    Cash Inflows - Cash Outflows =

  • Net Cash Flow
  • Opening Balance
  • Closing Balance
  • 14. 
    What is net cash flow?

  • The difference between revenue and cost
  • The difference between money in and money out
  • The difference between assets and liabilities
  • 15. 
    Cash is not the same as profit. Why?

  • Cash may come from loans and investors, profit only comes from sales revenue
  • They are the same
  • Cash is used to pay the bills within a business
  • Cash flow stops a business from going bankrupt
  • 16. 
    If a cashflow forecast suggests that a firm will run out of cash, which would help the problem?

  • purchase more fixed assets
  • repay a bank loan
  • pay suppliers immediately
  • delay paying suppliers
  • 17. 
    Which one of the following is an example of an outflow?

  • Capital
  • Bank Loan
  • Wages
  • Government Grant
  • 18. 
    Which of the following is true about cash flow?

  • It is the same as profit
  • It is different from profit
  • It is the same as revenue
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