Question

Financial functions format calculated values as currency, with _______. Question 3 options: a) positive cash flow appearing in red font b) positive cash flow enclosed in parentheses c) negative cash flow appearing in green font d) negative cash flow appearing in red font

Answer 1

Answer:

d) negative cash flow appearing in red font.

Explanation:

Colour coding is a type of excel formatting for financial modelling.

Color coding allows anyone to immediately pick up your model and know what can be changed (assumptions) and what should not be altered (formulas).

Example:

negative cash flow (Cash outflow) of the company appears in red font while positive cash flow (Cash inflow) of the company appears in green font.