Cash and profits Flashcards
1
Q
What is cash?
A
Money that is immediately available
2
Q
Profit =
A
Revenue - total costs
3
Q
What is profit affected by?
A
Any transaction that has an impact on the income statement
4
Q
Which transactions affect profit but not the cash position 7
A
Credit sales Credit purchases Sales returns Purchase returns Depreciation Irrecoverable debts Increase/decrease in doubtful debts
5
Q
Which transactions affect the cash position but not profit 7
A
Cash received from trade receivables Cash paid to trade receivables Share issue Loans received Loan repayments Dividends paid Purchase of non-current assets
6
Q
Which transactions do not affect cash or profits? 2
A
Bonus issue of shares
Revaluation of non-current assets
