Definitions of Components of Financial Statements Flashcards
(14 cards)
What is Revenue/Income?
Primary source of income e.g. sales or fees.
What is Sales Returns?
A negative income - subtract from sales.
What is Distribution Costs?
Expenses incurred in transferring ownership of finished goods or services to the consumer. Those expenses incurred through the promotion, storage, selling and delivery of the inventory for sale.
What is Cost of Goods Sold?
Expenses incurred in acquiring the goods for sale.
What is Administrative Expenses?
Expenses are caosts associated with the administration of the entity as a whole.
What is Finance Costs?
Arise from Financing its operations from external sources. Finance Costs are interest paid on borrowing.
What is Current Asset?
Asset that will be turned into cash or used up within the next accounting period.
What is Non-Current Assets?
Any asset that is not a current asset.
What is Current Liability?
Any liability that must be repaid within the next accounting period.
What is Non-Current Liability?
Any liability that is not a current liability.
What is Equity?
The residual interest in the assets of the business after deducting all liabilities e.g. A - L = Eq
What is Plant, Property and Equipment?
They are tangible items that are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes and are expected to be used during more than one period.
What is Investments?
All investments, such as shares, government stock and term deposits.
What is Intangible Assets?
Their assets you cannot touch but generate income for the business e.g. Goodwill, Trademark, Patents and Copyright.
