Final Exam NEWEST {2025-2026}
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, Statement of Cash Flows - correct ans:Shows the change in cash balance for a period of time. Focuses
only on items where cash is received, or cash is paid.
Cash Flow from Operating Activities (CFO) - correct ans:Cash flow that a company generates as a result
of day-to-day business operations. Deals with Current Assets and Current Liabilities.
Cash Flow from Investing Activities (CFI) - correct ans:Cash flow that is generated from investments in
long term assets.
Cash Flow from Financing Activities (CFF) - correct ans:Cash flow that is used to fund the company. Cash
flow that is generated from financing the business. Includes Debt & Equity.
How does an increase in Accounts receivable impact CFO? - correct ans:An Increase in Accounts
receivable will decrease CFO
How does an increase in Accounts payable impact CFO? - correct ans:An Increase in Accounts Payable
will increase CFO
What financial statement is prepared at a point in time - correct ans:Balance Sheet
What financial statements are prepared for a period of time? - correct ans:· Income Statement
· Retained Earnings Statement
· Statement of Cash Flows
Define Efficient Frontier - correct ans:Maximizes expected return for a given level of risk
Where would a risk averse investor fall on the efficient frontier? - correct ans:100% Bonds
Where would a risk-taking investor fall on the efficient frontier? - correct ans:100% Stocks