Which of the Following Statements Accurately Describes the Statement of Cash

question 36

Multiple Choice

Which of the following statements accurately describes the statement of cash flows?

• A)It shows the relative proportion of debt and assets.
• B)It shows the link between accrual based income and the cash reported on the balance sheet.
• C)It indicates when long-term debt will mature.
• D)It shows the link between book income and earnings per share.

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Definitions:

Revaluation Surplus

This is the increase in value of an asset after it has been appraised again and is recorded as a gain in equity under a company's financials.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that guide the preparation of financial statements globally.

Fair Value

The amount of money one would expect to obtain from selling an asset or the cost incurred to settle a liability, during a structured exchange between parties in the market, as of the valuation date.

Double-Declining-Balance

A method of accelerated depreciation that doubles the normal depreciation rate, reducing the book value of assets more quickly in the early years.