Business Finance

A receipt is _______________

A record of a transaction that already happened

What are accounts payable?

Amounts of money a company owes other companies

What are liquid assets?

Assets that are easily turned into cash

Which type of financial statement shows the company's assets, liability, and equity at a moment in time?

Balance sheet

Which piece of information would you find on an income statement?

Cost of goods sold

Taking out a long-term loan to fund your business is an example of which type of funding?

Debt

Total liabilities ÷ Total assets represents which type of financial ratio?

Debt ratio

A copy machine you rent for an office is an example of which type of cost?

Equipment cost

Which of the following is an advantage of accrual basis accounting?

It allows you to track money that is owed but not yet paid.

Which of the following statements about cash basis accounting is true?

It ensures the company always knows how much cash flow it has.

Which of the following is a way to improve cash flow?

Keep a cash reserve

Net profit before tax ÷ Total assets represents which type of financial ratio?

Return on assets

What are operating activities?

Revenue and expenses involved in running a business

Which type of financial statement includes information about retained earnings and dividends?

Statement of owners' equity

What are generally accepted accounting principles?

The set of commonly used accounting standards in the U.S.