A 'Funds Flow Statement' shows: MCQ with Answer and Explanation

Question
A 'Funds Flow Statement' shows:
A. Cash inflows and outflows
B. Changes in financial position between two periods
C. Changes in working capital
D. Profit for the year
Answer: Option B
Solution (By JKSSB Mock Tests)
Funds flow statement explains the change in financial position (working capital) between two balance sheets.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Practice More Accountancy and Book Keeping Questions

Question #1
Budgetary control is a system of controlling costs that includes:
A. Fixing of selling prices
B. Continuous comparison of actuals with budgets
C. Hiring of staff
D. Preparation of budgets only
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Correct Answer: Option B

Explanation:
Budgetary control involves preparing budgets and continuously comparing actual performance against the budget to take corrective action.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The 'Equalisation Levy' was expanded in 2020 to cover:
A. E-commerce supply of goods and services by non-resident e-commerce operators
B. Physical goods
C. All digital transactions
D. All services
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Correct Answer: Option A

Explanation:
Finance Act 2020 expanded scope to include e-commerce operators, even if they don't have a permanent establishment.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
The 'Independence' of an auditor is required because:
A. To reduce fees
B. To comply with company law only
C. To maintain objectivity and impartiality in the audit opinion
D. To increase revenue
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Correct Answer: Option C

Explanation:
Independence ensures unbiased opinion.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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