Financial Statements
What does an Income Statement show
Revenue, expenses and profit over time
This ratio measures a business's ability to pay short-term debts.
The Current Ratio
What is liquidity?
The ability of a business to pay its short-term debts.
Egypt
What does a Balance Sheet show?
Assets, liabilities and owner's equity at a specific point in time.
If current assets are $1000 and current liabilities are $500, what is the current ratio
2:1
What is money owed to a business by customers?
Accounts receivables
This country is known as the land of the rising sun.
Japan
What is a Cash Flow Statement
This financial statement tracks cash inflows and outflows.
Comment on a business with a current ratio of 3:1
A business has $3 of CA for every $1 of CL. Therefor a business is not maximising its profits and is unnecessarily hoarding cash.
What is equity finance?
Funds raised through selling ownership in a business
This superhero's alter ego is Bruce Wayne
Batman
What are examples of current assets and current liabilities?
Current assets: inventory, cash and accounts receivable
Current liabilities: accounts payable and short term loans
What is the gross profit ratio and what does it measure?
Gross profit/ sales and it measures the gross return on sales or the profitability of a business
What is gearing?
The proportion of debt compared to equity used to finance a business.
I have keys but no locks, space but no room, and you can enter but not go inside me. What am I?
A keyboard
This accounting equation forms the basis of the Balance Sheet?
Assets = liabilities + Owners Equity
How do we measure the efficiency of a business?
Expense ratio and accounts receivable ratio
This occurs when a business cannot pay its debts as they fall due.
Insolvency
This planet has the shortest day in the solar system, completing one rotation in about 10 hours.
Jupiter