
Unit 3.7 True or False - Cash flow
Authored by Jared Merwe
Business
11th Grade
Used 1+ times

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1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Insolvency occurs when a business has a negative cash flow but may actually be profitable.
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
The most liquid asset of a business is cash.
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Payments from debtors are recorded as a cash inflow for a business.
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Working capital is calculated by current assets plus current liabilities.
Answer explanation
False - current assets minus current liabilities
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Net cash flow is calculated by subtracting cash outflows from cash inflows.
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Working capital is the money needed to pay for the day-to-day running costs of a business, such as wages, utility bills, and the purchase of raw materials.
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
The period of time between the point cash being spent on the production of a product and the collection of cash from a customer is called the profitability cycle.
Answer explanation
False - this is the working capital cycle
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