Cash flow from operating activities includes: MCQ with Answer and Explanation

Question Report Error

Cash flow from operating activities includes:

A. Repayment of loan

B. Sale of machinery

C. Cash received from customers

D. Issue of shares

Answer: Option C

Solution (By JKExamLibrary)

Cash from customers is operating activity. Sale of machinery is investing, issue of shares and loan repayment are financing.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Practice More Accountancy and Book Keeping Questions

Question #1 Report Error

The gross profit ratio is 25%. If sales are ₹4,00,000, what is the cost of goods sold?

A. ₹4,00,000

B. ₹5,00,000

C. ₹1,00,000

D. ₹3,00,000

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Correct Answer: Option D

Explanation:
Gross Profit = 25% of 4,00,000 = ₹1,00,000. COGS = Sales - Gross Profit = 4,00,000 - 1,00,000 = ₹3,00,000.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2 Report Error

The 'Deduction under Section 80C' is available up to maximum of:

A. ₹1,50,000

B. ₹1,00,000

C. ₹50,000

D. ₹2,00,000

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Correct Answer: Option A

Explanation:
Under Section 80C, maximum deduction is ₹1,50,000.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3 Report Error

What is the primary scope of a 'Tax Audit' under Section 44AB of the Income Tax Act?

A. To find accounting errors

B. To assess social impact

C. To value the shares of the company

D. To ensure books are maintained per tax laws and compute taxable income correctly

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Correct Answer: Option D

Explanation:
A tax audit ensures compliance with the Income Tax Act, preventing tax evasion by verifying deductions and income reporting.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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