Cash Flow Forecast
21 days ago
mrmunro
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20 QuestionsShow answers
  • Question 1
    30 seconds
    Q.

    A cash flow statement shows an overview of money flowing in and out of a company

    answer choices

    True

    False

  • Question 2
    30 seconds
    Q. Which of the following is an example of a cash in-flow for a business?
    answer choices
    payment to suppliers
    paying back a loan to a bank
    payment from debtors
    purchase of fixed assets
  • Question 3
    30 seconds
    Q. Which of the following is an example of a cash out-flow for a business?
    answer choices
    payments to creditors
    sale of goods
    payment from debtors
    receiving a loan from the bank
  • Question 4
    30 seconds
    Q. Which of the following is NOT a use of cash-flow forecasts?
    answer choices
    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
  • Question 5
    30 seconds
    Q. A firm is forecast to have a negative closing bank balance. Which would reduce the problem?
    answer choices
    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
  • Question 6
    30 seconds
    Q. If a cashflow forecast suggests that a firm will run out of cash, which would help the problem?
    answer choices
    purchase more fixed assets
    repay a bank loan
    pay suppliers immediately
    delay paying suppliers
  • Question 7
    30 seconds
    Q. The monthly net cash flow for a business is calculated by:
    answer choices
    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
  • Question 8
    30 seconds
    Q. The closing bank balance is calculated by:
    answer choices
    opening bank balance + cash out-flow
    opening bank balance + cash in-flow
    opening bank balance + net cash flow
    net cash flow + gross profit
  • Question 9
    30 seconds
    Q.

    What is the money available to pay for day to day operational costs called?

    answer choices

    Cash

    Working capital

    Profit

    All of the above

  • Question 10
    30 seconds
    Q.

    Assume a firm sells goods costing £40,000 for £55,000. It provides the customer

    with 70% trade credit (i.e. the customer pays only 30% of the price as a down

    payment). The profit earned is __________, and the cash received is _________.

    answer choices

    £15,000, £12,000

    £15,000, £16,500

    £15,000, £28,000

    £15,000, £55,000

  • Question 11
    30 seconds
    Q.

    The term _________ describes how efficiently an asset can be converted into

    cash.

    answer choices

    Liquidity

    Solvency

    Conversion rate

    Working capital cycle

  • Question 12
    30 seconds
    Q.

    In a given cash flow forecast, the closing balance in June would become the ____________ of July.

    answer choices

    Closing balance

    Working capital

    Net cash flow

    Opening balance

  • Question 13
    20 seconds
    Q. Which one of the following is an example of an outflow? 
    answer choices
    Capital 
    Bank Loan
    Wages 
    Government Grant
  • Question 14
    45 seconds
    Q. Which of the following is true about cash flow?
    answer choices
    It is the same as profit
    It is different from profit
    It is the same as revenue
  • Question 15
    45 seconds
    Q. What is net cash flow?
    answer choices
    The difference between revenue and cost
    The difference between money in and money out
    The difference between assets and liabilities
  • Question 16
    45 seconds
    Q.

    Which of the following reduces a businesses cash flow?

    answer choices

    Asking debtors for payment

    Repaying an overdraft

    Securing better trade credit terms from suppliers

  • Question 17
    45 seconds
    Q. What is a long term way to improve cash inflow?
    answer choices
    Take out a loan
    Take out an overdraft
    Use a factoring service
  • Question 18
    45 seconds
    Q. How can cash outflows be improved?
    answer choices
    Buy extra equipment
    Lease out equipment
    Use a factoring service
  • Question 19
    30 seconds
    Q.

    selling an asset would be an example of

    answer choices

    cash inflow

    cash outflow

  • Question 20
    30 seconds
    Q.

    What is the formula used for a cash flow forecast?

    answer choices

    [ Receipts - Payments = Net Cash Flow ] + Opening Balance = Closing Balance.

    [ Receipts - Payments = Net Cash Flow ] - Opening Balance = Closing Balance.

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