Financial Acumen Training Quiz 1

Accounting vs Finance: Accounting function is a forward looking activity.

• Always true

• Always false

• Sometimes true

Accounting vs Finance: Which of the following activities is considered as a Finance activity?

• Auditing

• Financial reporting

• Bookkeeping

• Budgeting and forecasting

Financial Statements: Which of the following is not included in the basic financial statements?

• Income Statement

• Cash Flows

• Trial Balance

• Changes in Equity

Financial Statements: Which of the following financial statements shows a snapshot of the company' accounts at a given time?

• Profit and Loss

• Changes in Equity

• Balance Sheet

• Cash Flows

Business Operating Cycle: Fill in the blank - A healthier business has a ________ operating cycle.

• Shorter

• Longer

P&L: Which of the following is considered as part of Cost of Goods Sold (COGS)? Select all that applies.

• Royalties

• Provision for inventory obsolescence

• Salaries and incentive of field force employees

• Cost of products sold

Balance Sheet: Mr. A purchased a car worth $1.0M requiring 50% downpayment and 50% payable after 1 month. How will the transaction be recorded in his books at the time of purchase?

• (+)$500K Car

  (+)$500K Payable

• (+)$1M Car

  (+)$1M Payable

• (+)$1M Car

  (-)$500K Cash

  (+)$500K Payable

• (+)$1M Car

  (+)$500K Payable

  (+)$500K Equity

Balance Sheet: Please select which of the following is not considered as an Asset account?

• Accrued expense

• Prepaid expense

• Accounts receivables

• Advance payments

Cash Flows: What is the impact of credit term extensions given to customers in the cash flows of the company?

• Decrease in cash operating requirement

• Increase in cash operating requirement

• No impact on cash flows

• Increase or decrease depends on other factors

Financial Statements: Which of the following is affected by the company's daily operational activities

• Profit and Loss

• Balance Sheet

• Cash Flows

• All of the above

• None of the above