5 financial information and decisions

Question 1

Define llliquid

Answer 1

Asset that are not easily convertible into Cash

Question 2

Define liquidity 

Answer 2

The ability of a business to pay its short term debts

Question 3

Define profitability

Answer 3

The measurement of the profit made to either the value of sales achieved or the capital invested in the business

Question 4

Define capital employed

Answer 4

It’s the shareholders equity plus non-current liabilities and is the total long-term and permanent capital invested in the business

Question 5

Define Assets and Liabilities

Answer 5

Assets are items of value which are owned by the business (Can be fixed/non-current assets or short term/current assets)

Liabilities are debts owned by the business. (can be long-term or short term liabilities)