Chapter 16 Honors Business Management
How much are the liabilities for a local business if its assets are $750000 and its capital is $500000
$250000
If a company just shipped 20 computers to your school, the school should record the value of the computers on its balance sheet under
Assets
What information is found on a balance sheet?
Assets, liabilities, and capital
Is the amount of working capital one possible indicator that a business can pay its long-term debts?
No
When the amount of capital increases, must liabilities also increase?
No
Would a business with very little working capital find it easy to borrow money?
No
The balance sheet reveals the basic financial position of a business?
On a given date
A business can use an income statement to determine its?
Operating expenses
Another name for an income statement is?
Profit and loss statement
The three major parts of an income statement are?
Revenue, expenses, and profit or loss
An agency of the federal government that can asset small firms in getting loans under special conditions is the ?
Small Business Administration
Which of the following is a liability to you?
The amount you owe a friend
Is another name for a balance sheet a profit and loss statement?
No
On which financial record does a business list the building in which it does business?
Balance sheet
Which financial reports do businesses use most?
Balance sheet and income statement
After subtracting the liabilities from the assets, a business can determine?
How much it is worth
Because business success is judged in dollar terms, every business must do all of the following except?
Make decisions that affect part financial results
To calculate return on sales, divide?
Net profit by sales revenue
Are assets and capital the only categories listed on the balance sheet?
No
Can a business determine whether it can pay all its debts on a given date from looking at the income statement?
No
Does money usually flow into and out of a business at the same rate?
No
If a business purchased merchandise on credit, would the purchase be listed in the business's record under accounts receiveable?
No
The difference between current assets and current liabilities is?
Working capital
Are financial statement reports that summarize financial data over a period of time, such as a month, three months, or a year?
Yes
Can a business budget future expenditures by doing an item-by-item analysis of the income statement?
Yes
Can a financial ratio show whether the average monthly inventory might be too large or too small?
Yes
Can the financial position of a business on a given date be determined from the balance sheet?
Yes
Does the difference between total revenue and total expenses show the profit or loss of a business?
Yes
Does the heading of a balance include the name of the person or business, the title "Balance Sheet," and the date?
Yes
Is a consultant an expert whom companies hire to solve problems?
Yes
Is the amount of money a business earns one way to judge its success
Yes
Is the basic accounting equation represented on the balance sheet as Assets=Liabilities+Capital
Yes
Is the merchandise inventory the value of goods purchased to sell to customers at a profit?
Yes
To determine the amount of capital in a business, should you subtract the liabilities from the assets?
Yes
Will the net result of the income statement appear on the balance sheet?
Yes