Question

• Question (5)

In a UCA cash flow statement, what is true if a business did not generate enough cash from normal operations to pay both interest expense and scheduled debt principal?

a. Cash after debt amortization is positive.
b. Cash flow has increased.
c. Cash after debt amortization is negative.
d. Cash flow has decreased.

• Question (6)

If Net Cash After Operations is exactly zero on a UCA cash flow statement for the most recent period, the business was able to pay which expenses from internally generated cash flow?

I. All operating expenses.
II. All scheduled debt payments
III. Only a portion of operating expenses.
IV. At least a portion of interest expense.

a. I and II only.
b. III only.
c. III and IV only.
d. I only.

• Question (7)

Which statement about projection generation is most accurate?

a. Projection generation is likely more difficult using most spreadsheet software packages but should not include human judgment.
b. Projection generation is likely easier using most spreadsheet software packages but should not include human judgment.
c. Projection generation is likely easier using most spreadsheet software packages but should also include human judgment.
d. Projection generation is likely more difficult using most spreadsheet software packages but should also include human judgment.

• Question (8)

What is least likely to be used as a reference point to shape assumptions about future risk (cash) drivers?

a. Management's plans and objectives.
b. The economic and competitive environments.
c. Past operating results.
d. Spreadsheet software packages only.

• Question (9)

In a UCA cash flow statement, if a business has a cash surplus after repaying debt as scheduled, what does this likely indicate?

a. Its external financing requirement to pay for fixed asset purchases will be increased.
b. Its external financing requirement to pay for fixed asset purchases will be reduced.
c. It will have eliminated its potential for going out of business in the short run.
d. Its financing requirement for the period will be less than that surplus.

• Question (10)

Which statement about projections is least accurate?

a. Projections should determine if ''most likely case'' results are acceptable.
b. Projections should identify the most critical risk drivers.
c. Projections should assume that the future will be like the past.
d. Projections should establish a range of likely future outcomes.

• Question (11)

In a UCA cash flow statement, what is the correct calculation for operating income?

a. Net Profit + Cost of Goods Sold + Operating Expenses.
b. Net Sales - Cost of Goods Sold + Operating Expenses.
c. Net Profit + Cost of Goods Sold - Operating Expenses.
d. Net Sales - Cost of Goods Sold - Operating Expenses.

Answer 1

5) In a UCA cash flow statement, what is true if a business did not generate enough cash from normal operations to pay both interest expense and scheduled debt principal-

d)cash flow has decreased.

6)If Net Cash After Operations is exactly zero on a UCA cash flow statement for the most recent period, the business was able to pay which expenses from internally generated cash flow-

b) All schedule debt payments

7) (c) Projection generation is likely easier using most spreadsheet software packages but should also include human judgment.

8) b. The economic and competitive environments.

9) (b) Its external financing requirement to pay for fixed asset purchases will be reduced.

10)  c. Projections should assume that the future will be like the past.

11)d. Net Sales - Cost of Goods Sold - Operating Expenses.