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Film Art and History > Finance > Flashcards

Finance Flashcards

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1
Q

What is the Quick Ratio?

A

It indicates the company’s short-term liquidity position. How well it is able to pay off its short term loans

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2
Q

What is the Quick Ratio formula?

A

Current assets - Stock / Short Term Loan Capital

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3
Q

What should the Quick Ratio be?

A

Higher than 1,0

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4
Q

What is Solvency?

A

Solvency indicates how well a company is able to absorb its losses.

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5
Q

What does good Solvency mean?

A

That a company is able to absorb a good amount of losses and through that, that it can attract loans, sponsors, and investors

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6
Q

What is considered good Solvency?

A

For a starting company: 40% and higher

For an established company: 20% and higher

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7
Q

What is the Solvency formula?

A

Equity/Total Assets

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8
Q

What is Return on Equity?

A

Return on Equity tells us how good a company is at generating profit. Making money out of money

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9
Q

What is a good ratio for Return on Equity?

A

Acceptable ratio: 14%

Anything under 10% is poor

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10
Q

What is the Return on Equity formula?

A

Profit/Average Equity Capital * 100%

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11
Q

What is the Current Ratio?

A

A liquidity ratio that measures if a company has enough resources to meet its short-term obligations

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12
Q

What should the Current Ratio be?

A

Between 1,5- 4

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13
Q

What is the Current Ratio formula?

A

Current Assets/Current Liabilities

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14
Q

What is Net Working Capital?

A

The difference between a company’s current assets and current liabilities. Shows if a company can covet its current liabilities with its current assets in order to show if an investment is possible

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15
Q

What is a good Net Working Capital?

A

One that is positive, meaning that there is money over when the current liabilities are covered

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16
Q

What is the Net Working Capital formula?

A

Current Assets-Current Liabilities

17
Q

What is Gross Profit as a percentage of the Turnover?

A

It shows how much of the Turnover is Non-taxed Profit

18
Q

What is Gross Profit?

A

Revenue- Purchase Value

19
Q

What is the formula for Gross Profit as a percentage of the Turnover?

A

Gross Profit (Revenue-Purchase Value)/Revenue *100%

20
Q

How does one calculate the VAT % of a gross amount?

A
  1. Gross amount/ 1. Vat %

2. Subtract the resulting amount from the gross amount

21
Q

How does one add VAT % to a net amount?

A

Multiply the net amount by 1. VAT %.

22
Q

Which 4 points should be included when creating a digital form?

A

Entry Data, Monitoring Data, Authorization Data and Processing Data

23
Q

What are some examples of Entry Data?

A

Name, Address, Social Security number

24
Q

What are some examples of Monitoring Data?

A

Check on zip code, Employment Agency Number, Worked for the company before

25
Q

What are some examples of Authorization Data?

A

Name+approval (signature) of decision maker

26
Q

What are some examples of Processing Data?

A

Date, hours worked, who entered the data

27
Q

What code do Fixed Assets, Shareholders Equity, and Long -Term Debt have?

A

0

28
Q

What code do Liquid Assets (Except Stock), and Short-Term Debt have?

A

1

29
Q

Which code does Stock have?

A

3

30
Q

Which code do Costs have?

A

4

31
Q

What code do Turnover and Costs of Sales have?

A

8

32
Q

What code do Other Results have?

A

9

33
Q

How are journal entries for Asset Accounts produced?

A

Everything that is added/gained by the asset account is increased on the debit side.
Everything that is taken from/withdrawn from the asset account is displayed on the credit side.

34
Q

How are journal entries for Liability and Equity Accounts Produced?

A

Everything that is taken from/withdrawn/paid off from the liability and equity accounts, decreases on the debit side
Everything that is added/gained by the liability or equity account increases on the credit side

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