Which of the following is considered an investing activity in a cash flow statement? MCQ with Answer and Explanation

Question

Share Report Error

Which of the following is considered an investing activity in a cash flow statement?

A. Purchase of machinery

B. Payment of dividend

C. Issue of shares

D. Cash received from customers

Answer: Option A

Solution (By JKSSB Mock Tests)

Investing activities involve the acquisition and disposal of long-term assets and other investments not included in cash equivalents.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Request complete Subject PDF

Discuss this Question (0)

No comments yet. Be the first to start the discussion!

Practice More Accountancy and Book Keeping Questions

Question #1

Share Report

The threshold limit for paying Advance Tax is when the estimated tax liability for the year is:

A. Rs 10,000 or more

B. Rs 50,000 or more

C. Rs 5,000 or more

D. Rs 20,000 or more

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option A

Explanation:
If the estimated tax liability (after TDS) exceeds Rs 10,000, the taxpayer is obligated to pay advance tax in installments.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

Share Report

X and Y are partners with capitals ₹60,000 and ₹40,000. Z brings ₹50,000 as capital for 1/3rd share. Goodwill already appears in books at ₹30,000. The entry for existing goodwill will be:

A. Debit goodwill, credit all partners in new ratio

B. No entry

C. Debit X and Y, credit goodwill

D. Debit all partners' capital in old ratio, credit goodwill

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option D

Explanation:
Existing goodwill must be written off by debiting old partners' capital accounts in old ratio.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3

Share Report

If a cheque of Rs 1,000 is issued but recorded in the cash column of the Cash Book instead of the bank column, what is the effect on the bank balance?

A. Bank balance in Cash Book is overstated by Rs 1,000

B. Bank balance in Cash Book is understated by Rs 1,000

C. Cash balance is overstated

D. No effect on any balance

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option A

Explanation:
Since the bank column was not reduced (credited), the bank balance as per the Cash Book remains artificially high (overstated).

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Explore All Accountancy and Book Keeping MCQs