What to know
Identify the rule, formula, or decision criterion before reading the answer choices. CFA Level I distractors often use the right vocabulary with the wrong condition.
Financial Statement Analysis
Analyzing Statements of Cash Flows I practice questions
Analyzing Statements of Cash Flows I is part of CFA Level I Financial Statement Analysis. Financial Statement Analysis questions require careful reading of accounting choices, ratios, cash flow classification, inventories, taxes, leases, and reporting quality. Use this page to review the controlling ideas, then work through 10 questions with answer explanations and common traps.
Review the worked explanations before moving into adaptive practice. The app version can mix this topic with due reviews and weak related concepts.
Practice this topicHow to practice
Work each item under time pressure, then compare your reasoning with the step-by-step explanation and key takeaway.
Review signal
Missed questions should become scheduled reviews when the error comes from a concept gap, formula setup, or answer-choice trap.
Financial Statement Analysis
Analyzing Statements of Cash Flows I
Under IFRS, income taxes paid are most likely classified on the statement of cash flows as cash flows from:
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Analyzing Statements of Cash Flows I
Priya Raman is converting an indirect-method statement to the direct method. Selling, general, and administrative expense for the year is $240 million. During the year, prepaid expenses increased by $15 million and accrued expense liabilities increased by $10 million. Cash paid for operating expenses is closest to:
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Analyzing Statements of Cash Flows I
Omar Haddad reviews a company that reports interest expense of $48 million for the year, which includes $6 million of bond discount amortization. Interest payable increased by $4 million during the year. Cash paid for interest is closest to:
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Analyzing Statements of Cash Flows I
Cash paid to acquire equipment is most likely classified as a cash flow from:
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Analyzing Statements of Cash Flows I
Under U.S. GAAP, interest paid is classified as:
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Analyzing Statements of Cash Flows I
Net income is 100, depreciation expense is 25, accounts receivable increased by 10, inventory decreased by 5, and accounts payable increased by 8. CFO using the indirect method is closest to:
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Analyzing Statements of Cash Flows I
Sales are 500. Accounts receivable increased from 60 to 75. Cash received from customers is closest to:
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Analyzing Statements of Cash Flows I
Cost of goods sold is 300, inventory increased by 20, and accounts payable increased by 15. Cash paid to suppliers is closest to:
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Analyzing Statements of Cash Flows I
Under IFRS, dividends paid may be classified as:
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Analyzing Statements of Cash Flows I
A company reports a gain on sale of equipment in net income. Under the indirect method, the gain is most likely:
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