Project's expected monetary loss or gain by discounting all cash outflows and inflows, using required rate of return is classified as

Arrange the following categories of cash inflows and cash outflows in a correct order.
1. Cash flows from investing activities.
2. Cash flows from financing activities.
3. Cash flows from operating activities.

A

3, 1, 2

B

1, 3, 2

C

3, 2, 1

D

2, 1, 3

A project which have one series of cash inflows and results in one or more cash outflows is classified as

A

abnormal costs

B

normal cash flows

C

abnormal cash flow

D

normal costs

Which of the following are examples of cash flow from operating activities as per AS-7?
1. Cash receipts from the sale of goods and the rendering of services.
2. Cash receipts from disposal of intangible assets.
3. Cash receipts from royalties, fees, commissions and other revenue.
4. Cash payments to suppliers for goods and services.
5. Cash proceeds from issuing shares or other similar instruments.
6. Cash payments to and on behalf of employees.
Select the correct answer:

A

1, 3, 4 and 6

B

2, 5 and 6

C

1, 2, 3 and 4

D

2, 3, 4 and 6

"BDL Ltd. is currently preparing its cash budget for the year to 31 March 20XX. An extract from its sales budget for the same year shows the following sales values.
Rs
March 60,000
April 70,000
May 55,000
June 65,000
40% of its sales are expected to be for cash. Of its credit sales, 70% are expected to pay in month after sale and take a 2% discount. 27% are expected to pay in the second month after the sale, and the remaining 3% are expected to be bad debts. The value of sales budget to be shown in the cash budget for May 20XX is"

A

Rs. 60,532

B

Rs. 61,120

C

Rs. 66,532

D

Rs. 86,620

The present value of cash inflows is $60, 000 and present value of the cash outflows is $ 50, 000 then NPV is?

A

€ 10,000

B

$ 10,000

C

$ 10100

D

% 10010

Given below are two statements, one labelled as Assertion (A) and the other labelled as Reason (R). Read the statements and choose the correct answer:
Assertion (A) The nominal interest rate comprises of a real interest rate and an expected rate of inflation and it adjusts when the inflation rate is expected to change. Hence, in the perfect international capital markets, real rate of returns are equal in the two countries.
Reason (R) The international fisher effects states that the nominal interest rate differential must be equal to the expected inflation rate differential In the two countries.

A

Both (A) and (R) are correct and (R) is the right explanation of (A)

B

Both (A) and (R) are correct, but (R) is not the right explanation of (A)

C

(A) is correct, but (R) is not correct

D

Both (A) and (R) are incorrect

Which of the following activities should be shown separately in the cash flow statement prepared as per Accounting Standard-3?
1. Cash flow from borrowing activities
2. Cash flow from operating activities
3. Cash flow from financing activities
4. Cash flow from investing activities
5. Cash flow from miscellaneous activitie

A

1, 2 and 3

B

1, 3 and 5

C

1, 3 and 4

D

1, 2 and 5

Which of the following activities should be shown separately in the cash flow statement prepared as per accounting standard-3?
I. Cash flow from borrowing activities.
II. Cash flow from operating activities.
III. Cash flow from financing activities.
IV. Cash flow from investing activities.
V. Cash flow from miscellaneous activities.

A

I, II and III

B

I, III and V

C

II, III and IV

D

I, IV and V

Interim cash inflows are reinvested at a rate of return equal to the internal rate of return is the built-in mechanism for

A

Net present value method

B

Internal rate of return method

C

Profitablity index method

D

None of the above

Which one of the following equates the present value of cash out flows and the present value of expected cash inflows from a project?

A

Net Present Value

B

Internal Rate of Return

C

Payback Period

D

Accounting Rate of Return