Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

Exams > ARA > Flashcards

ARA Flashcards

(54 cards)

Start Studying
1
Q

what is a non-current asset

A

won’t be used up in the next year

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

current asset

A

will be used up within the next year

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

book value formula

A

historical cost - depreciation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

debt to equity ratio

A

liabilities/equity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

EBIT

A

NPAT + interest expense + tax expense

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

EBITDA

A

EBIT + depreciation + amortisation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

P/E ratio

A

share price/ EPS

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

price to book ratio

A

share price/ equity per share

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

price to sales ratio

A

share price/ revenue per share

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

what is the best relative valuation ratio for a retail

A

price to sales ratio

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

what is the best relative valuation ratio for profitable firms

A

p/e ratio

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

what is the best relative valuation ratio for high leverage firms

A

price to book ratio

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

net change in cash and equivalents

A

cash from operating + cash from investing + cash from financing activities

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

free cash flows

A

operating cash flow - capital expenditure

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

CAPM

A

rf+ beta(rm-rf)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

present value of equity

A

FCF/(re-g)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

asset turnover

A

sales / avg assets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

operating profit margin

A

EBIT / revenue

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

ROA

A

NPAT/ avg assets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

ROE

A

NPAT / avg equity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

gross profit margin

A

gross profit / revenue

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

avg days inventory

Study These Flashcards
A

(avg inventory/ cost of sales) * 365

23
Q

current ratio

Study These Flashcards
A

current assets/current liabilities

24
Q

quick ratio

Study These Flashcards
A

(current assets - inventories)/ current liabilities

25
times interest earned
EBIT/ (finance costs - finance income)
26
operating cycle
inventory days + AR days
27
cash cycle
inventory days + AR days - AP days
28
debt ratio
liabilities / assets
29
contribution margin
price - variable cost
30
margin of safety
(expected sales volume - break even volume)/ expected sales volume
31
credit turnover in days
(avg trade receivables/ revenue) * 365
32
cost of sales
beginning inventory + purchases - closing inventory
33
net profit margin
net profit/ revenue
34
during year end close what happens to revenue and expense accounts
they are transferred into an income summary account which is then closed into retained earnings
35
A firm purchased a truck for $65,000, assuming that its useful life will be 5 years at the end of which its estimated residual value will be $5,000. The company used the truck for 2 years and so far deducted depreciation of $24,000. The truck's carrying amount is $41,000. This accounting treatment is consistent with which measurement base/approach?
cost
36
The issue with not recognising marketing expenditures as brand value is that it leads to a substantially ______stated book value of equity over time.
under
37
if we know profit has increased in a year what does that tell us about profitability
doesnt have enough information - profitability is how efficiently it makes money in comparison to things like assets or debt
38
horizontal analysis
trend over time
39
vertical analysis
expresses each item in financial statement as percentage of base amount
40
equity ratio
equity/assets
41
who are the primary stakeholders for climate related reporting
investors and creditors
42
Criteria for assets
Resource controlled by the entity Result of a past event Expected to produce future economic benefits
43
what are the criteria for a liability
Present obligation of the entity Arising from a past event Expected to result in an outflow of economic resources
44
net realisable value
The cash the business expects to get from selling an asset, after subtracting selling and finishing costs.
45
what is a good current ratio
1.5
46
gross profit
revenue - cogs
47
net profit
revenue - all expenses
48
what is npat in relation to profits
net profit
49
what is ebit in terms of profit
ebit = gross profit - operating expenses
50
balance sheet vertical analysis base
total assets
51
cash flow vertical analysis base
total cash inflows
52
income statement vertical analysis base
net revenue
53
Becker Ltd has the following balance sheet figures Total assets = $500,000 Total liabilities = $150,000 Share capital and reserves = $350,000 What is the equity ratio?
70%
54
what are the steps of intrinsic valuation
1.fcfe 2. risk adjustment 3. growth expectations 4. forecasting current period free cash flows 5. present value 6. share price

Exams (3 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions