3.4 Final Accounts (Balance Sheet) Flashcards
Non-Current Assets Definition
Long-term assets of an organisation not intended for resale in the next 12 months of the balance sheet date - also known as fixed assets, these assets are used repeatedly in a business
Depreciation or Accumulated Depreciation Definition
An accumulated reduction in the value of assets (e.g. devices, vehicles)
Current Assets Definition
Assets that can be converted to cash (liquidated) within one year.
Current Liabilities Definition
Financial obligation due to be paid within one year
Non-Current Liabilities Definition
AKA long-term liabilities - financial obligations due more than one year in the future
Net Assets Definition
The total assets of a business, with liabilities deducted
Equity Definition
The money that shareholders have invested in the business plus retained profit
Cash Definiton
All cash in hand and in a bank account
Debtors Definition
Individuals/organisations that a business owes money to - current asset
Stock/Inventory Definition
Goods available for sale - raw materials, finished/semi-finished products
Non-Current Assets Calculation
Property, plant and equipment - Accumulated depreciation = Non-current assets
(1) on sheet
Current Assets Calculation
Cash + Debtors + Stock = Current assets
(2) on sheet
Current Liabilities Calculation
Bank overdraft + Trade creditors + Other short-term loans = Current liabilities
(4) on sheet
Non-Current Liabilities Calculation
Borrowings (long-term) = Non-current liabilities
(5) on sheet
Net Assets Calculation
Total assets - Total liabilities = Net assets
