Chapters 29,30,31 Flashcards
Statement of Comprehensive Income
Financial document showing a firm’s income and expenses in a particular time period.
Profit
Money left after all costs have been subtracted from revenue
Gross profit
Profit before expenses.
Sales revenue - sales cost
Operating Profit
Gross profit - expenses
Distributed profit
Profit that is returned to the owners of a business
Retained profit
Profit held by a business to be used for the future
Divided
Share of the profit paid to shareholders in a company
Finance cost
Interest paid on loans
Finance income
Interest received by the business in deposit accounts
Normal profit
Minimum profit a business needs to make to retain the interest of the owner
Adjustments
Includes adjustments for the profits made on the disposal of assets
Statement of financial position
Summary at a point in time of business assets,liabilities and capital
Assets
Resources used or owned by a business; tools, equipment, stock and machinery
Liabilities
Debts of the business
Capital
Finance provided by the owners of the business
Non-current assets
Assets that last for more than 1 year.
Current assets
Assets likely to be changed into cash within a year
Liquidity
Ease or speed with which assets
Trade receivables
Amounts of money that are owed to a company but its customers
Current liabilities
Debt that have to be repaid within a year
Net Current Assets
Current assets minus current liabilities, also known as working capital.
Non-current Liabilities
Debts that are payable after 12 month
Net Assets
All assets - all liabilities
Goodwill
Valué that a company has because it has a good relationship with its customers and suppliers
