Fund Balance That Consists of Amounts Such as Inventory That

question 16

Multiple Choice

Fund balance that consists of amounts such as inventory that are not in spendable form is classified as:

• A)restricted.
• B)committed.
• C)nonspendable.
• D)assigned.

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Definitions:

Indirect Method

A way to prepare cash flow statements where net income is adjusted for non-cash expenses, changes in working capital, and non-operating cash flows to calculate cash flow from operating activities.

Operating Activities

The day-to-day functions of a business related to producing and selling its goods or services, which are reflected in its cash flow.

Investing Activity

Transactions and events that involve the purchase and/or sale of long-term assets and other investments, as shown in a company’s cash flow statement.

Income Statement

A financial document that reports a company's revenues, expenses, and net profit or loss over a specific period of time.