Chapter 25 Flashcards
1
Q
define assets
A
are those items of value which are owned by the business.
2
Q
define liabilities
A
are debts owed by the business
3
Q
describe what the statement of financial position shows
A
The statement of financial position shows the value of a business’s assets and liabilities at a particular time.
4
Q
state the working capital formula
A
Working capital = Current assets - Current liabilities
5
Q
state the capital employed formula
A
Capital employed = Shareholders’ funds + Non-current liabilities
6
Q
mention one type of asset
A
Cash Investments Inventory Office equipment Machinery Real estate Company-owned vehicles
7
Q
state the owners’ equity formula
A
Total assets – Total liabilities = Owners’ equity
8
Q
define non-current assets
A
are items owned by the business for more than one year.
