Statement of comprehensive income - F

Question 1

What does statement of comprehensive income

mean?

Answer 1

Statement of comprehensive income – shows the trading position of the business which is used to calculate gross profit. It then takes into account all other expenses to calculate the profit or loss for the year.

Question 2

What does statement of financial position mean?

Answer 2

Statement of financial position – a snapshot of a business’s net worth at a particular moment in time, normally the end of a financial year.

Question 3

What does cost of goods sold mean?

Answer 3

Cost of goods sold– the actual value of inventory used to generate sales.

Question 4

What does opening inventory mean?

Answer 4

Opening inventory– the value of inventory in a business at the start of a financial year.

Question 5

What does historic cost mean?

Answer 5

Historic cost– the cost of an asset when it was first purchased.

Question 6

What does expected life mean ?

Answer 6

Expected life– how long an asset is expected to be used within a business.

Question 7

What does residual value mean?

Answer 7

Residual value – the value of an asset when it is disposed of by he business, for example, resale value..

Question 8

What does closing inventory mean?

Answer 8

Closing inventory– the value of inventory at the end of a financial year.