Question

Match List - I with List - II

List - I	List - II
(A) The Accounting basis for Cash Flow Statement is	(II) Cash Basis
(B) Dividend paid on Equity and Preference capital comes under	(IV) Cash outflow from Financing Activities
(C) It cannot be considered as cash and cash equivalents	(I) Investment in shares
(D) It can be classified as cash and cash equivalents	(III) Treasury bills

Choose the correct answer from the options given above:

• A. (A)-(IV), (B)-(I), (C)-(II), (D)-(III)
• B. (A)-(IV), (B)-(III), (C)-(IV), (D)-(I)
• C. (A)-(II), (B)-(IV), (C)-(I), (D)-(III)
• D. (A)-(I), (B)-(II), (C)-(III), (D)-(IV)

Hint:

"Use logic and flow to identify key components for all types of statements to avoid mistakes."

Answer 1

The Correct Option is C

Understanding Cash Flow Statement Components:
\begin{itemize} \item
The Accounting basis for Cash Flow Statement is (A): Cash basis is used to determine accurate measures of cash flow. \item
Dividend paid on Equity and Preference capital comes under (B): Cash outflow from financing activities is recorded when dividends are paid to shareholders. \item
It can not be considered as cash and cash equivalents (C): Investment in shares is not part of cash and cash equivalents due to its illiquid nature. \item
It can be classified as cash and cash equivalents (D): Treasury bills are classified as cash equivalents due to their short maturity and liquidity. \end{itemize} Thus, the correct matching is (A)-(II), (B)-(IV), (C)-(I), (D)-(III).