Financial Statements Flashcards
What does an income statement calculate?
Profit or loss for the year
Write out the title of an income statement for CGS plc
Income statement for CGS plc for the year ended xxx
I) What is the top section of the income statement called? II) What is the bottom section of the income statement called?
I) Trading account I) profit and loss account
What is the difference between an income statement for a service based firm and a retailer?
No inventory for service based therefore no cost of sales section
How to calculate cost of sales
Opening inventory
+ purchases
+ carriage in
- purchase returns
- closing inventory
Define gross profit
Profit on trading
What do you do after calculating gross profit give examples
Add additional income e.g rent received, discount received
Less expenses e.g rent, wages, depreciation
What is the different between carriage in and out
Delivery in v delivery out
What does a SoFP show? And what is the layout?
Financial position of the business
A= C + L
What is the key words in the title of the SoFP
AS AT
What is a I) Current asset II) non current asset III) non current liability IV) current liability
I) asset owned for less than a year
II) asset owned for more than a year
III) owed by the business for over a year
IV) owed by the business for less than a year
What goes in the capital section of a sole trader?
Opening capital
Capital introduced
Profit/loss
Drawings
Closing capital
