Accounting Multiple Choice Question – 14 January 2021

In its accounts, a company makes a transfer from profits to general reserve.

How will this be shown in the cash flow statement?

Select ONE answer:

1. as an adjustment not involving the movement of cash
2. as a source of cash
3. as a use of cash
4. not appear at all

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct

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