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WorksheetsTopic 3.7 Cash Flow
Total questions: 16
Worksheet time: 12mins
Name
Class
Date
1.
If a company sells 400 units of their product at an average price of $15 per unit, what is their total revenue?
a)
$6,000
b)
$4,500
c)
$4,000
d)
$7,500
2.
A firm produces 500 units at a total cost of $2,000. What is their average total cost of production?
a)
$4 per unit
b)
$5 per unit
c)
$3 per unit
d)
$2 per unit
3.
Which of the following is NOT a use of cash-flow forecasts?
a)
They indicate how much cash is available for paying bills
b)
They show how much the bank needs to lend to stop insolvency
c)
They indicate whether the business is holding too much cash
d)
They indicate how much profit the business will make
4.
Which is the best explanation for a business running into cash-flow problems?
a)
demanding quick payment from customers
b)
allowing customers a long credit period
c)
delaying payments to suppliers
d)
producing goods when demanded by customers
5.
Business cash flow forecasts are of use in all of the following situations except:
a)
calculating last year’s profit or loss
b)
finding out how much cash will be needed to start a business
c)
keeping informed about the liquidity of the business
d)
helping the manager to plan when to borrow money
6.
If a cashflow forecast suggests that a firm will run out of cash, which would help the problem?
a)
purchase more fixed assets
b)
repay a bank loan
c)
pay suppliers immediately
d)
delay paying suppliers
7.
The monthly net cash flow for a business is calculated by:
a)
sales revenue - cost of goods sold
b)
total cash in - total cash out
c)
total cash out - total cash in
d)
total cash in - cost of goods sold
8.
The following would appear in which section of the cash flow statement?
Cash payments to employees for payroll
a)
Operating
b)
Investing
c)
Financing
9.
The following would appear in which section of the cash flow statement?
Cash received from the sale of property
a)
Operating
b)
Investing
c)
Financing
10.
A firm is forecast to have a negative closing bank balance. Which would reduce the problem?
a)
sell more goods on 4 months credit
b)
produce more goods
c)
ask customers to pay in cash and not sell goods on credit
d)
ask suppliers if the firm can pay for goods in cash
11.
What is the money available to pay for day to day operational costs called?
a)
Cash
b)
Working capital
c)
Profit
d)
All of the above
12.
The term _________ describes how efficiently an asset can be converted into
cash.
a)
Liquidity
b)
Solvency
c)
Conversion rate
d)
Working capital cycle
13.
Which one of the following is an example of an outflow?
a)
Capital
b)
Bank Loan
c)
Wages
d)
Government Grant
14.
Which of the following is the value of x?
a)
£2
b)
£4
c)
£6
d)
(£2)
15.
Which of the following is the value of y?
a)
£4
b)
£6
c)
£9
d)
(£9)
16.
Which of the following is the value of z?
a)
£2
b)
£5
c)
£(15)
d)
£(5)
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