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Business Functions > BF Accounting Prep > Flashcards

BF Accounting Prep Flashcards

1
Q

Accounting Definition

A

Financial and non-financial information needed to gauge the financial performance, financial stability and financial health of an organisation

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2
Q

Performance

A

Profit = Revenue less Expenses

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3
Q

stability

A

Assets > Liabilities

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4
Q

health

A

cash flow, credit sales data

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5
Q

What are the components of a balance sheet?

A

Assets, Liabilities, and Owners equity

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6
Q

what is the equation of a balance sheet

A

A = L + OE

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7
Q

what is a current asset

A

an item that is cash or could be cash that can be acquired within a reporting period

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8
Q

what is a non-current asset

A

PPE, investments or assets that can’t be acquired within the reporting period

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9
Q

what are some examples of Property, Plant and Equipment?

A

Motor vehicles, plant, buildings, computers ect

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10
Q

what is an intangible asset?

A

legal rights to some process, invention, name, symbol, or business operations

Patents, copyrights, franchises, trademarks, goodwill

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11
Q

what is a current liability?

A

amounts which is required to be repaid within the current reporting period

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12
Q

what is a Non-current liability?

A

amounts which are due for repayment beyond the current reporting period eg loan for 5 years

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13
Q

what is Owners equity?

A

the remaining interest in the assets of the entity, after liabilities

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14
Q

what are some examples of Owners equity?

A

Capital, Capital introduces, Profit/Loss, Distributions

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15
Q

What are the two elements that make up an Income Statement

A

Income and Expenses

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16
Q

what is the equation for the income statement?

A

Income - Expenses = Profit or Loss

17
Q

what is net profit?

A

profit after expenses

18
Q

what is gross profit?

A

profit from selling products less cost of products.

19
Q

What is a budget?

A

a detailed PLAN summarising the future financial consequences

20
Q

what is Variance?

A

the difference between the budgeting figure and the actual figures the business makes

21
Q

what is the equation of Variance %?

A

Variance/Budget x 100

22
Q

What is Working capital?

A

current assets - current liabilities

23
Q

what is current ratio?

A

current assets divided by current liabilities

24
Q

what is a Debt to equity ratio

A

total liabilities divided by owners equity

25
Q
A

Business Functions (2 decks)

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