{"id":59347,"date":"2024-04-16T01:35:36","date_gmt":"2024-04-16T01:35:36","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=59347"},"modified":"2024-04-16T01:35:36","modified_gmt":"2024-04-16T01:35:36","slug":"indicate-the-correct-option-as-regards-the-sources-of-funds-for-a-funds-flow-statement-from-the-following-1-increase-in-working-capital-2-decrease-in-working-capital-3-writing-off-the-intangible","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/indicate-the-correct-option-as-regards-the-sources-of-funds-for-a-funds-flow-statement-from-the-following-1-increase-in-working-capital-2-decrease-in-working-capital-3-writing-off-the-intangible\/","title":{"rendered":"Indicate the correct option as regards the sources of funds for a funds flow statement from the following 1. Increase in working capital. 2. Decrease in working capital. 3. Writing-off the intangible\/fictitious assets. 4. Issuing equity shares for acquisition of a building for office. 5. Charging depreciation on fixed assets. Select the correct answer"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;1, 3 and 4&#8243; option2=&#8221;2, 3 and 5&#8243; option3=&#8221;1, 4 and 5&#8243; option4=&#8221;2, 3 and 4&#8243; correct=&#8221;option1&#8243;]<!--more--><\/p>\n<p>The correct answer is A. 1, 3 and 4.<\/p>\n<p>A funds flow statement is a financial statement that shows how a company&#8217;s cash and cash equivalents have changed over a period of time. It is prepared by analyzing the changes in the company&#8217;s balance sheet and income statement.<\/p>\n<p>The sources of funds for a funds flow statement are the following:<\/p>\n<ul>\n<li>Increase in working capital: This occurs when a company&#8217;s current assets increase more than its current liabilities.<\/li>\n<li>Decrease in working capital: This occurs when a company&#8217;s current assets decrease more than its current liabilities.<\/li>\n<li>Issuing equity shares: This occurs when a company sells new shares to investors.<\/li>\n<li>Borrowing money: This occurs when a company takes out a loan from a bank or other lender.<\/li>\n<li>Selling fixed assets: This occurs when a company sells a piece of property, plant, or equipment.<\/li>\n<\/ul>\n<p>The uses of funds for a funds flow statement are the following:<\/p>\n<ul>\n<li>Decrease in working capital: This occurs when a company&#8217;s current assets decrease more than its current liabilities.<\/li>\n<li>Increase in working capital: This occurs when a company&#8217;s current assets increase more than its current liabilities.<\/li>\n<li>Repurchasing shares: This occurs when a company buys back its own shares from investors.<\/li>\n<li>Paying off debt: This occurs when a company pays back a loan to a bank or other lender.<\/li>\n<li>Investing in fixed assets: This occurs when a company buys a piece of property, plant, or equipment.<\/li>\n<\/ul>\n<p>In the question, the options are:<\/p>\n<ol>\n<li>Increase in working capital.<\/li>\n<li>Decrease in working capital.<\/li>\n<li>Writing-off the intangible\/fictitious assets.<\/li>\n<li>Issuing equity shares for acquisition of a building for office.<\/li>\n<li>Charging depreciation on fixed assets.<\/li>\n<\/ol>\n<p>Option 1 is a source of funds because it represents an increase in a company&#8217;s current assets. Option 3 is a source of funds because it represents a decrease in a company&#8217;s intangible assets. Option 4 is a source of funds because it represents an increase in a company&#8217;s equity. Option 5 is not a source of funds because it represents an expense that reduces a company&#8217;s net income. Therefore, the correct answer is A. 1, 3 and 4.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;1, 3 and 4&#8243; option2=&#8221;2, 3 and 5&#8243; option3=&#8221;1, 4 and 5&#8243; option4=&#8221;2, 3 and 4&#8243; correct=&#8221;option1&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[952],"tags":[],"class_list":["post-59347","post","type-post","status-publish","format-standard","hentry","category-costing","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Indicate the correct option as regards the sources of funds for a funds flow statement from the following 1. Increase in working capital. 2. Decrease in working capital. 3. 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Increase in working capital. 2. Decrease in working capital. 3. Writing-off the intangible\/fictitious assets. 4. Issuing equity shares for acquisition of a building for office. 5. Charging depreciation on fixed assets. Select the correct answer","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/indicate-the-correct-option-as-regards-the-sources-of-funds-for-a-funds-flow-statement-from-the-following-1-increase-in-working-capital-2-decrease-in-working-capital-3-writing-off-the-intangible\/","og_locale":"en_US","og_type":"article","og_title":"Indicate the correct option as regards the sources of funds for a funds flow statement from the following 1. Increase in working capital. 2. Decrease in working capital. 3. Writing-off the intangible\/fictitious assets. 4. Issuing equity shares for acquisition of a building for office. 5. 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