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LC Business - Definitions > Accounting > Flashcards

Accounting Flashcards

1
Q

Trading account and Profit and Loss Account

A 
Sales
Cost of Sales
Gross profit
Expenses
Net Profit
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2
Q

balance sheet

A

Shows the value of the business assets and liabilities

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3
Q

Gross Profit margin formula

A

Gross Profit
——————- x 100
Sales

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4
Q

Net Profit Margin formula

A

Net Profit
—————– x 100
Sales

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5
Q

Return on Investment definition

A

Shows how efficient the managers are at running the company

Compare with what the banks are offering on a savings account (5%)

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6
Q

Current ratio defintion

A

Tells a business how much money it has for every €1 it owes

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7
Q

Current ratio formula

A

Current liabilities

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8
Q

Acid test ratio definition

A

Tells a business how much real cash it has for every €1 it owes

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9
Q

Acid test ratio formula

A

Current liabilities

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10
Q

Gearing definition

A

Is an analysis of the capital structure of the business

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11
Q

Gearing formula

A

Equity shares + Retained earnings (Equity capital)

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LC Business - Definitions (24 decks)

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