Cash Flow and Financial Statements Quiz

What does the opening balance represent?

• Closing balance of previous month

• Total cash outflows

• Total cash inflows

• Net cash flow

What is the formula for net cash flow?

• Total cash inflows - total cash outflows

• Opening balance + closing balance

• Total outflow - total inflow

• Total inflow + total outflow

Which of the following is a fixed cost?

• Utilities based on usage

• Wages

• Raw materials

• Sales commissions

What does gross profit equal?

• Revenue - expenses

• Total cash inflows - total cash outflows

• Revenue - costs

• Costs + expenses

What is the formula for the current ratio?

• Current liabilities / current assets

• Current assets / current liabilities

• Current assets - current liabilities

• Current assets + current liabilities

What should the current ratio ideally be?

• Less than 1

• Between 1.5 and 2

• Exactly 2

• More than 3

What is the meaning of non-current liabilities?

• Debts to be repaid in less than one year

• Debts to be repaid over a period of more than one year

• Current assets that can be converted to cash

• Short-term loans from suppliers

What does the net profit margin measure?

• Total revenue / total costs

• Total expenses / revenue

• Net profit / revenue * 100

• Gross profit / revenue

Which of the following is a current asset?

• Cash

• Machinery

• Long-term investments

• Buildings

What is the formula for return on capital employed?

• Gross profit / total revenue

• Profit / capital employed * 100

• Net profit / total assets

• Revenue - expenses