Basic

Question 1

What is a balance sheet?

Answer 1

A statement that reports on the assets, liability and equity of a company at a specific point in time.

Question 2

What is equity?

Answer 2

The funding related to stockholders.

Question 3

What is common stock?

Answer 3

The funding from shareholders.

Question 4

What are retained earnings?

Answer 4

Past earnings which haven’t been distributed to stockholders.

Question 5

What is the balance sheet equation?

Answer 5

assets = liability + equity

Question 6

What is an income statement?

Answer 6

A statement that shows a company’s revenue, expenses and net income in a period.

Question 7

What is gross profit?

Answer 7

Revenue - COGS

Question 8

What are operating expenses?

Answer 8

Expenses that can’t be linked to individual products sold

Question 9

What is operating income?

Answer 9

How much is earned before side activities, interest, and taxes.

Question 10

What is the formula for operating income?

Answer 10

Gross profit - operating expenses

Question 11

What is another name for operating income?

Answer 11

EBIT

Question 12

What is a cash flow statement?

Answer 12

A statement that summarizes the movements of cash and cash equivalents in and out of the company.

Question 13

What is another name for net income?

Answer 13

after-tax profits

Question 14

What goes under CFO?

Answer 14

cash flow from operating activities

Question 15

What goes under CFI?

Answer 15

changes in cash from the purchase or sale of property, plants, equipment (PP&E), or long-term investments.

Question 16

What goes under CFF?

Answer 16

This category reports cash level changes from the purchase of a company’s own stock or issue of bonds and payments of interest and dividends to shareholders