Financial statements - the basics Flashcards
1
Q
What are returns inwards also known as?
A
Sales returns.
2
Q
What are returns outwards also known as?
A
Purchase returns.
3
Q
How do you calculate net purchases?
A
Purchases - returns outwards + carriage inwards.
4
Q
How do you calculate cost of sales/cost of goods sold?
A
Opening inventory+net purchases-closing inventory.
5
Q
How is gross profit calculated?
A
Net revenue-cost of sales.
6
Q
What is the accounting equation?
A
Assets = liabilities + capital.
7
Q
How do you calculate net current assets?
A
Total current assets - total current liabilities.
