Module 10

The main financial statements needed are the _____, the income statement and the cash flow statement.
1. check book
2. balance sheet
3. cash receipt
4. invoice
_________________ are a vital and integral part of a report: do NOT fail to read them.
1. Dictionaries
2. Footnotes
3. Receipts
4. Salaries
Owners' ____________________ is the net worth of the company.
1. equity
2. asset
3. liability
4. competition
_________________ are the financial obligations a company owes to other entities.
1. Assets
2. Expenses
3. Liabilities
4. Invoices
If a company lacks enough cash to pay its bills, it __________________________________.
1. gets the money in the middle of May
2. must exceed its periodic cash outflows
3. can be paid either physically or electronically
4. can be forced into bankruptcy and liquidation
The cash flow statement shows that a company ________________________________.
1. has cash or it does not
2. can be forced into liquidation
3. risks manipulation through creative accounting
4. fails to generate cash
When reading footnotes it is important to _________________________________.
1. determine when revenue was earned
2. analyze the company's accounting methods
3. disclose additional information
4. include statements correcting errors
There are ______________________ for ensuring footnotes are clear and readable.
1. legal and technical jargon
2. short shrifts to major issues
3. no standards
4. things concealed from investors
The prospectus is a ___________________ and so must meet legal transparency standards.
1. detailed document
2. valuable market share
3. legal and technical jargon
4. legal declaration
Because the information in a prospectus is just projections the actual outcomes are _____________.
1. uncertain
2. unbelievable
3. certain
4. suspicious

Module 10

Post test