Statement of Financial position Flashcards
What is a statement of financial position?
Assets, liabilities and equity
What are trade payables?
This is when you owe money to someone (opposite of trade recieveables)
What are trade recieveables?
This is when someone owe’s you money (opposite of trade payable)
What are assets?
This is what the business own’s
What are liabilities?
This is what the business owe’s
What is equity?
This is how it is financed
What are non-current assets?
Items owned fro a long period of time e.g. vehicles or buildings
What are current assets?
These are items owned for a short period of time e.g. cash, inventory
What are current liabilities?
Items owed for a short period of time e.g. bank overdrafts, VAT, trade payables
What are non-current liabilities?
This is when an item is owed for a long period of time e.g. bank loans or morgages
What is working equity?
This is the ability to pay a short term debt (current assets-current liabilities) (ready cash available)
What are net assets employed?
The value of non-current assets added to working figure equity (non-current assets +/- working equity)
What are net assets?
The overall value of the business (net assets-noncurrent liabilities)
What are equity and reserves?
This shows that the business has been financed
What are examples of equity?
Shares, retained profits, capital, profit for the year
