CFA Level 1 Practice Questions — All Questions
AllEthical & Professional StandardsQuantitative MethodsFinancial Reporting & AnalysisCorporate IssuersInvestment Tools (Equity & Fixed Income)
4 questions
Financial Reporting & Analysis
Which statement reports a company's financial position at a point in time?
- a.Income statement
- b.Balance sheet✓
- c.Cash flow statement
- d.Statement of changes in equity
The balance sheet shows assets, liabilities, and equity at a point in time.
Financial Reporting & Analysis
Under accrual accounting, revenue is recognized when it is:
- a.Earned, regardless of when cash is received✓
- b.Received in cash
- c.Budgeted
- d.Taxed
Accrual accounting recognizes revenue when earned, not when cash arrives.
Financial Reporting & Analysis
The basic accounting equation is:
- a.Assets = Revenue - Expenses
- b.Assets = Liabilities - Equity
- c.Assets = Liabilities + Equity✓
- d.Equity = Assets + Liabilities
Assets equal liabilities plus owners' equity.
Financial Reporting & Analysis
Which statement explains the change in a company's cash over a period?
- a.Balance sheet
- b.Income statement
- c.Statement of retained earnings
- d.Cash flow statement✓
The cash flow statement reconciles operating, investing, and financing cash flows.