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During the year, a business was bought by issue of Rs 25,000 debentures and Rs 25,000 shares. The business bought had machine worth Rs 20,000, Debtors Rs 15,000, Stock Rs 5,000 and Creditors Rs 5,000. Determine the effect of this transaction on flow of funds.

A. Net outflow of Rs 15,000

B. Net inflow of Rs 15,000

C. Neither inflow nor outflow

D. None of the above

Related Questions on Management Accounting Test Questions

Time value of money indicates that

A. A unit of money obtained today is worth more than a unit of money obtained in future

B. A unit of money obtained today is worth less than a unit of money obtained in future

C. There is no difference in the value of money obtained today and tomorrow

D. None of the above