Match the following regarding the cash flow statement.
| LIST 1 | LIST 2 |
| A) Purchase of furniture by issue of shares | I) Inflow of cash |
| B) Debentures are issued for cash | II) Outflow of cash |
| C) Purchase of goods for cash | III) No flow of cash |
| D) Cash withdraw from bank | IV) Cash equivalent |
Answer & explanation
Correct answer: option 1
The correct answer is option 1- A-III, B-I, C-II, D-IV.
| LIST 1 | LIST 2 |
| A) Purchase of furniture by issue of shares | III) No flow of cash |
| B) Debentures are issued for cash | I) Inflow of cash |
| C) Purchase of goods for cash | II) Outflow of cash |
| D) Cash withdraw from bank | IV) Cash equivalent |
A) Purchase of furniture by issue of shares- Furniture is purchased but shares are issued means there is no use of cash.
B) Debentures are issued for cash- Debentures are issued means cash came to the company which is an inflow of cash.
C) Purchase of goods for cash- Goods are purchased by paying cash means cash outflow takes place in the company.
D) Cash withdraw from bank- Cash equivalent. Bank balance is converted into cash in hand.