Y5 T1 Fairman Acc. Chapter 7.pptVIP

EXAMPLE PROBLEM #40 - 7 True or False. The net profit of a company is always equal to the change in cash during the same period. Explain. EXAMPLE PROBLEM #41 - 7 True or False. Having too much cash on the balance sheet or having too little cash are both signs of poor cash management by the company. Explain. EXAMPLE PROBLEM #42 - 7 The following is a list of business/accounting events. In each case, state the effect (increase, decrease, or no change) on both cash and profit: a) repayment of a loan b) making a sale on credit (higher than cost) c) buying a non-current asset for cash