3.5.1 Interpretation of Financial Accounts Flashcards

1
Q

Stakeholder interests in statement of comprehensive income: Shareholders

A

Interested in profit for the year as this may indicate potential returns for shareholders.

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2
Q

Stakeholder interests in statement of comprehensive income: Managers

A

Use revenue, gross profit and operating profit to measure performance and set targets.

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3
Q

Stakeholder interests in statement of comprehensive income: Government

A

To identify level of taxation business needs to pay.

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4
Q

Stakeholder interests in statement of comprehensive income: Employees

A

Profitability of business may indicate potential for rumination and rewards.

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5
Q

Stakeholder interests in statement of financial position: Shareholders

A

Analyse asset structure of business to see how investment has been spent.

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6
Q

Stakeholder interests in statement of financial position: Managers

A

Analyse liquidity and level of risk associated with debt.

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7
Q

Stakeholder interests in statement of financial position: Suppliers

A

Whether the business will be able to pay its debts and support any decisions around credit agreements.

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