I n t e r a c t I v e t e X t foundations in Accountancy/ acca financial accounting (ffa/FA) bpp learning Media is an acca approved Content Provider

QUICK QUIZ 

CHAPTER ROUNDUP 

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CHAPTER 22  

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  STATEMENTS OF CASH FLOWS 

 

399 

1 

The objective of IAS 7 is to provide information for users about the company's ability to generate cash  

 and 

cash equivalents. 

2 

Further information is available about liquidation and solvency, of the change in net assets, the ability to 

adapt to changing circumstances and comparability between entities. 

3 

Cash comprises cash on hand and demand deposits. Cash equivalents

 

are short-term, highly liquid 

investments that are readily convertible to known amounts of cash and which are subject to an 

insignificant risk of changes in value. 

4 

C 

Administration costs are a classification in the statement of profit or loss, not the statement of 

cash flows. 

5 

C 

PROPERTY, PLANT AND EQUIPMENT 

 

   

$'000 

 

 $'000 

Opening balance 

 

600 

Disposals 

 90 

Purchases (balancing figure) 

 

240 

Closing balance 

        750 

 

 

840 

 

        840 

Purchase of property, plant and equipment 

 240,000 

Proceeds of sale of property, plant and equipment 

 

 

(30,000) 

Net cash outflow 

 210,000 

6 B  

 

 

$'000 

Issue of share capital for cash (2,000 + 500 – 1,000 – 500 bonus)) 

 

1,000 

Repayment of loan stock (1,000 – 750) 

  (250) 

Net cash inflow 

   750 

7 

True.  A decrease in receivables means more cash. 

 

 

 

 

Now try ... 

 

Attempt the questions below from the Practice Question Bank 

 

Qs 84 – 86  

 

 

 

 

 

 

 

 

 

 

ANSWERS TO QUICK QUIZ 

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