Unit 3 Accounting

Question 1

Working capital

Answer 1

Current assets - current liabilities

Question 2

Current ratio

Answer 2

Current assets / current liabilities

Question 3

Acid test ratio also known as liquid capital ratio

Answer 3

(Current assets - stock) / current liabilities

Question 4

Gross profit margin

Answer 4

(Gross profit / sales revenue) X 100

Question 5

Net profit margin

Answer 5

(net profit / sales revenue) X 100

Question 6

ROCE

Answer 6

(Net profit / capital employed) x 100

Question 7

Productivity equation

Answer 7

Total output / number of workers

Question 8

Types of Owner ship

Answer 8

Sole trader ( owner by himself)
Partnership
Private limited company or public limited company

Question 9

What are the 5 steps of analysing data

Answer 9

1 define the problem 
2 collect the data 
3 analyse the data 
4 present the results 
5 draw a conclusion

Question 10

Breaking even point

Answer 10

Fixed cost / contribution (selling price - variable cost)

Question 11

Net profit

Answer 11

Gross profit - expenses

Question 12

Gross profit

Answer 12

Sales revenue - cost of sales

Question 13

Contribution per unit formulae

Answer 13

Selling price - variable cost per unit

Question 13

Total contribution

Answer 13

Contribution per unit x number of units sold

Question 13

Margin of safety

Answer 13

Sales - breaking even level of output

Question 13

Straight line depreciation

Answer 13

Annual depreciation = asset purchase price - estimate salvage value / estimated useful life of asset

Question 13

Trade receivable days

Answer 13

(Trade receivables / crest sales ) X 365

Question 13

Trade payable days

Answer 13

(Trade payables / Credit purchases) x 365

Question 14

Inventory turnover

Answer 14

(Average inventory / cost of sale) x 365