Question

1)Information to prepare the statement of cash flows usually comes from (a) comparative balance sheets, (b) current income statement, and (c) additional information.

Select one:

True

False

2)

A cash coverage ratio of less than 1 indicates cash inadequacy to meet asset growth.

Select one:

True

False.

3)A cash coverage ratio of less than 1 indicates cash inadequacy to meet asset growth.

Select one:

True

False

4)One of the usual differences between financial and managerial accounting is the time dimension of the information reported.

Select one:

True

False

Answer 1

1. True:

Information required to prepare statement of cash flow comes from comparative balance, current income statement and additional information as cash flow statement shows cash inflow and outflow during a period.

2. False

A cash coverage ratio of less than 1 indicates cash inadequacy to meet interest expense.

3..False

A cash coverage ratio of less than 1 indicates cash inadequacy to meet interest expense.

4. True

In managerial accounting information is reported to managers quickly than in financial accounting where information is provided at year end.