Accounts Payable/Receivable
What element is Accounts Payable on the Balance Sheet?
Complete this Nursery Rhyme.
Hey diddle diddle, the cat and the fiddle,
The cow jumped over the moon.
The little dog laughed to see such fun
And the _________ ran away with the spoon!
Dish
How is the Historical Cost of a Non-Current Asset calculated?
Purchase invoice (exc. GST) plus additional costs to get the asset in location and ready to use
What is the largest continent (area)?
Asia
Sales - Sales returns - Costs of Sales=
Gross Profit
What is the Accounts Receivable Turnover formula?
Avg. Accounts Receivable / Net Credit Sales x 365
Complete this Nursery Rhyme.
Hickory dickory dock
The _________ ran up the clock
The clock struck __________
The _________ ran down
Hickory dickory dock.
Mouse
One
What accounting element is depreciation expense ?
Expense
Vienna is the Capital City of which country?
Austria
Gross Profit- Inventory Loss/Gain =
Adjusted Gross Profit
Comment on the Accounts Receivable turnover
2020: 28 days
2021: 29 days
2022: 32 days
The accounts receivable turnover is increasing which is not good for the business. This means that suppliers are taking longer to pay off their obligation to the business and reduces the cash flow of the business
Complete this Nursery Rhyme.
London Bridge is falling down,
Falling down, falling down.
London Bridge is falling down,
_______________.
My Fair Lady
A new van was purchased for $20,100 (excl. GST). The van is estimated to have a useful life of 6 years and a residual value of $1,500.
Calculate annual Depreciation expense for the van.
= C - RV / 6
= 20,100 - 1,500 / 6
= $3,100
Behind Everest, what is the second largest mountain in the world?
K2, also known as Mount Godwin-Austen or Chhogori
What is the last line of an Income Statement?
Net Profit (Loss)
Comment on the business accounts payable turnover. Provide a positive and negative of this figure
2020: 32 days
2021: 30 days
2022: 25 days
Trend: decreasing turnover
Positive: building positive relationships with suppliers as we are paying them back quicker and getting a discount
Negative: We could use the full 30 days to pay off other obligations as we dont need to pay back all our suppliers quickly
Complete this Nursery Rhyme.
Oh, do you know the muffin man?
The muffin man?
The muffin man
Oh, do you know the muffin man?
That lives on ______________ ?
Drury Lane
State the Formula for calculating Asset Turnover (ATO).
Asset Turnover = Net Sales / Avg. Total Assets
Also beginning with 'T', which African country served as the setting for the desert planet Tatooine in Star Wars?
Tunisia
Where does the Net Profit(loss) go on the Balance Sheet?
Owners Equity
2020:
Bad Debts $2000
Sales returns 2% of sales
Accounts Receivable 28 days
2021:
Bad Debts $2400
Sales Returns 3% of sales
Accounts Receivable: 29 days
Profitability is impacted by increasing bad debts (expense), increasing sales returns (expense). This means that net profit
Strategy: improve credit terms, improve quality of product and follow up more with emails to suppliers
Complete this Nursery Rhyme.
Baa baa black sheep, have you any wool?
Yes sir, yes sir, three bags full!
One for the _________, one for the _________,
And one for _____________________________.
Master
Dame
The Little Boy who lives down the lane
State the formula for calculating Return on Assets (ROA).
Return on Assets = (Net Profit / Avg. Total Assets) x 100
Behind Brazil, which South American country has the longest coastline?
Chile
Bad Debts, Wages and Depreciation Expense are found where in an Income Statement?
Other Expenses