Flipped: Financial Informations & Decisions

Question 1

finance needed by new business to pay for essential non-current (fixed) assets before it can begin trading

Answer 1

start-up capital

Question 2

capital available to a business to pay its day-to-day costs

Answer 2

working capital

Question 3

money spent on non-current (fixed) assets which will last for more than one year

Answer 3

capital expenditure

Question 4

money spent on day-to-day expenses which do not involve the purchase of a long-term asset

Answer 4

revenue expenditure

Question 5

obtained from within the business itself

Answer 5

internal finance

Question 6

obtained from sources outside of and seperate from the business

Answer 6

external finance

Question 7

providing financial services to poor people not served by traditional banks

Answer 7

micro-finance

Question 8

funding a project/venture by raising money from a large number of people who each contribute a relatively small amount

Answer 8

crowdfunding

Question 9

cash inflows and outflows over a period of time

Answer 9

cash flow

Question 10

sum of money received by a business during a period of time

Answer 10

cash inflows

Question 11

sum of money paid out by a business during a period of time

Answer 11

cash outflows

Question 12

shows the stages between paying out cash for labour, materials and so on, and receiving cash from the sale of goods

Answer 12

cash flow cycle

Question 13

surplus after total costs have been subtracted from revenue

Answer 13

profit

Question 14

prediction of future cash inflows and outflows of a business over a period of time

Answer 14

cash flow forecast

Question 15

difference between inflows and outflows (between months)

Answer 15

net cash flow

Question 16

amount of cash held by the business at the end of each month (next month’s opening cash balance)

Answer 16

closing cash

Question 17

amount of cash held by the business at the start of the month

Answer 17

opening cash

Question 18

financial records of a firm’s transactions

Answer 18

accounts

Question 19

professionally qualified people who have responsibility for keeping accurate accounts and for producing the final accounts

Answer 19

accountants

Question 20

produced at the end of the financial year and give details of the profit or loss made over the year and the worth of the business

Answer 20

final accounts

Question 21

financial statement that records the income of a business and all costs incurred to earn that income over a period of time

Answer 21

income statement

Question 22

income to a business during a period of time from the sale of goods/services

Answer 22

revenue

Question 23

cost of producing/buying in the goods actually sold by the business during a time period

Answer 23

cost of sales

Question 24

made when revenue is greater than the cost of sales

Answer 24

gross profit

Question 25

shows how the gross profit of a business is calculated

Answer 25

trading account

Question 26

profit made after all cost have been deducted from revenue (gross profit - overhead costs)

Answer 26

net profit

Question 27

fall in the value of a fixed asset over time

Answer 27

depreciation

Question 28

net profit reinvested back into a company, after deducting tax and payments to owners

Answer 28

retained profit

Question 29

shows the vale of a businesses' assets and liabilities at a particular time

Answer 29

statement of financial position

Question 30

items of value which are owned by the business

Answer 30

assets

Question 31

debts owed by the business

Answer 31

liabilities

Question 32

items owned by the business for more than one year

Answer 32

non-current assets

Question 33

owned by a business and used within one year

Answer 33

current assets

Question 34

long-term debts owed by the business, repaid over more than one year

Answer 34

non-current liabilities

Question 35

short-term debts owed by the business, repaid in less than one year

Answer 35

current liabilities

Question 36

shareholders' equity plus non-current liabilities and is the total long-term and permanent capital invested in a business

Answer 36

capital employed

Question 37

ability of a business to pay back its short-term debts

Answer 37

liquidity

Question 38

the measurement of the profit made relative to either the value of sales achieved or the capital invested in the business

Answer 38

profitability

Question 39

assets are not easily convertible into cash

Answer 39

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