Podcast
Questions and Answers
What financial document captures revenues and expenses but does not track the actual inflow and outflow of money?
What financial document captures revenues and expenses but does not track the actual inflow and outflow of money?
- Balance Sheet
- Cash Flow Statement
- Financial Statement
- Income Statement (correct)
Why is a separate Cash Flow Statement needed in addition to the Income Statement?
Why is a separate Cash Flow Statement needed in addition to the Income Statement?
- To calculate profits
- To track revenues and expenses
- To forecast sales
- To monitor actual cash inflows and outflows (correct)
What is the purpose of a cash flow forecast in a company?
What is the purpose of a cash flow forecast in a company?
- To track sales
- To prepare tax returns
- To calculate net income
- To estimate expected money flows (correct)
If a company has negative cash flow for a month, what is likely to happen to its bank account balance?
If a company has negative cash flow for a month, what is likely to happen to its bank account balance?
Which financial document helps a company assess if it has enough cash or credit to pay its bills?
Which financial document helps a company assess if it has enough cash or credit to pay its bills?
What does the Income Statement focus on primarily?
What does the Income Statement focus on primarily?
In what situation would a company increase the amount borrowed on its line of credit?
In what situation would a company increase the amount borrowed on its line of credit?
Which financial document helps in monitoring when actual payments for expenses are made?
Which financial document helps in monitoring when actual payments for expenses are made?
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