Accounting Analysis Flashcards
Which of the below would NOT be on an income statement?
Trade payables
Which of the following is the key difference between the current ratio and the quick ratio?
Inventory
Which of the following is NOT part of shareholders’ funds?
Investments in associates
The best definition of enterprise cash flow would be:
Cash flow to all providers of finance
What would you not expect to find under tangible non-current assets?
Work-in-progress
Which of the following would NOT be found in an income statement?
Deferred tax liability
Which of the following has taken into consideration the repayment of debentures?
Equity cash flow
Which of the following would not be included within shareholders funds?
Warrants
Which of the following is not part of shareholders’ funds?
Authorised share capital
What would you not expect to find under tangible non-current assets?
Work-in-progress
What is the effect of ‘capitalisation’ of expenditure on the statement of financial position?
Cash decreases and non-current assets increase
Return on capital employed
Return on capital employed = profit before interest and tax / capital employed.
Which of the following would appear on a cash flow statement?
Acquisitions and disposals
Return on equity
ROE = Profit to ordinary shareholders / shareholder funds
Where on a company’s statement of financial position would you find the share premium account?
Capital and reserves
On the statement of financial position, which one below would not appear as intangible non current assets?
Revaluation reserve
The gross profit margin will take into account which of the following?
Only the cost of goods
The company has produced its financial statements and have enclosed additional disclosures in the notes. Which of the following will LEAST likely appear in these notes?
The statement of investment principles
Which would you NOT find as a current liability in a statement of financial position?
Interest paid
Which one of the following would be classified as capital expenditure?
The purchase of computers for new work premises
Where in the financial statements would you find tax payable?
Statement of financial position
When would a company disclose a minority interest in the statement of financial position?
A subsidiary company is not fully owned by the group
Any increase in inventory
deduct from trading profit, the decrease in receivables: add to trading profit and the Increase in payables: add to trading profit.
Which of the following would usually be found under non-current assets in a statement of financial position?
Computers
Land and buildings
All of the following are intangible non-current assets except:
Share premium
The current ratio is typically used to measure which one of the following within a company?
Liquidity
All of the following are current assets except:
Payables
In a statement of financial position (balance sheet), prepayments come under which category?
Current assets
Which of the following items would be found in a cash flow statement?
Equity dividends paid
What is net asset value per ordinary share?
(Assets - liabilities) / number of ordinary shares
Which of the following will increase the shareholder’s funds of a company?
Rights issue
Offer for subscription
The role of the auditor includes:
To report whether the accounts have been properly prepared in accordance with the accounting policies
Which of the following would best describe enterprise cash flow?
Free cash flow before considering any financing costs
Which of the following does NOT appear in the cash flow statement?
Net assets
Which of the following is not a heading in the cash flow statement?
Dividends paid and proposed
All of the following are current assets, except:
Provisions
Which of the following items does not appear in the cash flow statement?
Deferred taxation
In which of the following financial statements would you find proceeds on issue of bonds and equities?
Cash flow statement
Which of these is shown on the income statement?
Interest
The share premium account could be used in which one of the following situations?
A company does a capitalisation issue
Which of the following best describes a minority interest/non-controlling interest in the context of a consolidated income statement?
Profits due to outside shareholders in subsidiaries
Which of the following would you see on a cash flow statement?
Equity dividends paid
Which of the following best describes the quick ratio (acid test)?
Receivables + cash / payables + short-term borrowings
Which of the following is not a non-current asset?
Inventory held in the company warehouse
When calculating earning per share (EPS), which of the following would not be removed from the operating profits of a company?
Ordinary share dividends
A company has completed a 1:5 stock-split. Following the stock-split the most likely impact on the company’s Debt to equity ratio will be:
It will remain unchanged
A dividend can be paid with which of the following:
Profit and loss reserve
The accounting equation can be described as
Assets = capital + reserves + liabilities
Turnover less cost of sales less distribution costs less administration expenses equals:
Operating profit
Which of the following statements does not apply to cash flow statements?
They show how much profit was earned during the year
