AFC Module 6 - Cash Flow Statement

Question 1

CASH BASIS

Answer 1

only transactions involving actual cash received or cash spent are recorded

Question 2

EXPENSES

Answer 2

total expenditures made in a specified time such as reported in a cash flow statement

Question 3

FIXED EXPENSES

Answer 3

Expenses that recur at fixed intervals

Question 4

INCOME

Answer 4

What is earned from salaries or wages, as well as other sources like bonuses, interest/dividend received, housing allowance, etc.

Question 5

SURPLUS

Answer 5

When total income exceeds total expenses such as reported on a cash-flow statement

Question 6

VARIABLE EXPENSES

Answer 6

Expenses over which you have substantial control.

Question 7

CASH FLOW STATEMENT

Answer 7

Analytical tool that highlight whether or not client has sufficient income to pay their bills.

Question 8

What is on a cash flow statement?

Answer 8

1. Income
2. Expenses
3. Surplus (net gain) or Deficit (net loss)

Question 9

How do you classify expenses?

Answer 9

1. Fixed expenses
2. Variable expenses

Question 10

CASH - FLOW FORMULA

Answer 10

Total Income - Total Expenses = Surplus (or Deficit)