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2ND MIDTERMS > FABM 2 > Flashcards

FABM 2 Flashcards

1
Q

It explains the net change in cash for the year

A

statement of cash flow

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2
Q

Three major activities in SCF

A

operarting, investing, financing

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3
Q

main-revenue producing activities of the company

A

operating activities

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4
Q

main-revenue producing activities of the company. examples are cash from customers and cash paid to suppliers or employees

A

operating activities

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5
Q

acquisition and disposal of long term assets

A

investing

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6
Q

cash transactions related to changes in equity and borrowings

A

financing

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7
Q

process of evaluating risk, performance, financial, health, and future prospects of a business by subjecting financial statement data to computational and analytical techniques with the objective of making economic decisions

A

financial statement analysis

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8
Q

it is a also called as trend analysis. it is a technique for evaluating a series of FS data over a period of time with the purpose of determining the increase or decrease that has taken place

A

horizontal analysis

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9
Q

balance of current year - balance of prior year

A

peso change

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10
Q

percentage change

A

peso change divided by balance of prior year

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11
Q

it is also called as common size analysis

A

vertical analysis

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12
Q

it is also called as common size analysis. a technique that expresses each financial statement item as a percentage of a base amount

A

vertical analysis

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13
Q

balance of account / total sales

A

net sales

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14
Q

net income as a percentage of sales is also known as

A

net profit margin

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15
Q

the relationship is expressed in terms of a percentage, a rate, or a simple proportion. composed of numerator and denominator

A

ratio analysis

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16
Q

it is the ability of the company to generate income from the use of its assets and invested capital

A

profitability ratio

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17
Q

formula of gross profit margin

A

gross profit/net sales x 100

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18
Q

formula for operating income margin

A

operating income/net sales x 100

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19
Q

formula for net profit margin

A

net income/net sales x 100

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20
Q

Average assets

A

asset of beginning + asset of ending /2

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21
Q

return on assets formula

A

net income/average assets x 100

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22
Q

return on equity formula

A

net income/average equity x 100

23
Q

ability of the company to generate sales from its utilization of assets

A

operational efficiency

24
Q

it measure the peso value of sales generated for every peso of the company’s assets

A

asset turnover

25
Q

it is the indicator of the efficiency of fixed assets in generating sales

A

fixed asset turnover (equipment)

26
Q

it is an indicator of how fast the company can sell inventory

A

inventory turnover

27
Q

this measures the number of days from acquisition to sale

A

days in inventory

28
Q

it measure the number of times the company was able to collect on its average accounts receivable during the year.

A

accounts receivable turnover

29
Q

this measure the company’s collection period which is the number of days from sale to collection

A

days in a/r average collection period

30
Q

look into the company’s solvency and liquidity

A

financial health ratio

31
Q

it refers to the company’s capacity to pay their long-term liabilities

A

solvency

32
Q

ratio intends to measure the company’s ability to pay debts that are coming due (short term debt)

A

liquidity

33
Q

ratios under solvency

A

debt to equity
debt ratio
equity ratio
interest coverage ratio

34
Q

ratios under liquidity

A

current ratio
quick ratio

35
Q

it is the company’s reliance to debt or liability as a source of financing relative to equity

A

debt to equity ratio

36
Q

percentage of the company’s assets that are financed by debt

A

debt ratio

37
Q

percentage of the company’s assets that are financed by capital

A

equity ratio

38
Q

company’s ability to cover the interest expense on its liability with its operating income

A

interest coverage ratio

39
Q

it seeks to measure whether there are sufficient current assets to pay for current liabilities

A

current ratio

40
Q

it does not consider all the current assets, only those that are easier to liquidate such as cash and accounts receivable

A

quick ratio

41
Q

formula for operating income

A

gross profit-operating expenses

42
Q

it allows a person with excess money to deposit his money and earns an interest rate

A

bank

43
Q

it plays an important role in the economy for offering finance to businesses who wish to invest and expand

A

bank

44
Q

these are intended to provide an incentive for the depositor to save money

A

savings account

45
Q

type of a savings account that is held for a fixed-term and can be withdrawn only after the lapse of the agreed period and by giving notice to the bank

A

time deposit

46
Q

the account may be withdrawn also anytime however the bank usually charge penalties. This type of account yield high interests

A

time deposit

47
Q

account wherein withdrawals can be made through designated machines. a 24 hours teller machine and the funds can be withdrawn anytime

A

atm (automated teller machine)

48
Q

money held under a checking account can be withdrawn through issuance of a check. banks usually allows numerous withdrawals and unlimited deposit under this type of account

A

checking or current account

49
Q

the usually required information in this slip are account name, account number, date, currency, amount in words, and in figures

A

deposit slip

50
Q

these slips are used to take out money or to put in money to the depositor’s account. Without this, the bank will not allow you to get money from your account.

A

withdrawal slip

51
Q

it is a document that orders a bank to pay a specific amount of money from a person’s account to the person in whose name the check has been issued.

A

bank check

52
Q

it is the person or entity who makes the check

A

drawer

53
Q

it is the recipient of the money

A

payee

54
Q

the bank or other financial institution where the check can be presented for payment

A

drawee

2ND MIDTERMS (8 decks)

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