Unit 1 VCE Accounting

Financial Indicators

100

What is the Formula for WCR?

Current Assets / Current Liabilities

200

What is the formula for Debt Ratio

Liabilities / Assets

300

What is Liquidity?

A businesses ability to meet its short term obligations

400

What could an Owner do to improve the Debt Ratio and WCR at the same time?

Capital Contribution

500

What could an Owner do to improve their WCR but keep their Debt Ratio the same

Converting NCA's to CA's

Financial Reports

100

Name the Accounting Reports

Balance Sheet, Income Statement, Cash Flow Statement

200

Name the sections of the Cash Flow Statement

Operating, Investing, Financing

300

What is calculated on a Income Statement

Net Profit

400

Name a transaction that would increase Net Profit but not effect Net Cash Surplus

Credit Sale

500

How many totals would you find on a classified Balance Sheet?

Seven

Source Documents

100

What is shown by a Receipt?

Sale

200

What is shown by a Memo?

Internal Transaction

300

What would a business supply to its Accounts Receivable each month?

Statement of Account

400

What do all GST inclusive Source Documents say on them?

Tax Invoice

500

Which part of the Accounting Process involves source documents?

Collection of Raw Data

Twofold Effect

100

State the Twofold Effect:

A business purchases Inventory with cash, $440 inc GST

INV, INC, 400

CAB, DEC, 440

GST C, DEC, 40

200

State the Twofold Effect:

A business completes a construction job, $3300 cash exc GST

Construction Revenue, INC, $3300 therefore OE, INC, $3300

GST C, INC, $330

CAB. INC. $3630

300

State the Twofold Effect:

A business receives $1,200 exc GST from a past sale

AR, DEC, 1200

CAB, INC, 1200

400

State the Twofold Effect:

The owner took $600 worth of inventory for personal use

Drawings, INC, 600 therefore, OE, DEC, 600

INV, DEC, 600

500

State the Twofold Effect:

The owner changes his personal loan of $20000 to be the businesses

Capital, DEC, 20000 therefore, OE, DEC, 20000

Loan, INC 20000

QC's and AA's

100

Define Verifiability

Independent Observers must be able to reach a consensus that a particular event is depicted faithfully

200

List the QC's

T

U

R

F

C

V

300

What AA or QC is broken when a business chooses to prepare its reports once a year?

Timeliness

400

Which AA or QC has the most letters in its name?

Accrual Basis Assumption / Going Concern Assumption

500

Excluding 'THE', how many words are there in all of the titles of all the AA's and QC's

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