Interpretation of Financial Statements Flashcards Preview

FSLC Level 4 > Interpretation of Financial Statements > Flashcards

Flashcards in Interpretation of Financial Statements Deck (6)
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1

What does profability mean?

The relationship between profit and revenue, assets, equity and capital employed.

2

What does liquidity mean?

stability of company on a short term basis.

3

What are some ratios to measure profability?

- Gross Profit Percentage
- Expenses/revenue Percentage
- Operating Profit Percentage
- ROCE
- Return on Shareholders funds

4

What are some ratios to measure liquidity?

- Current Ratio
- Acid Test Ratio

5

What are some ratios to measure use of resources?

- Inventory Turnover and holding period
- Trade receivable collection period
- Trade payables payment period
- Working capital cycle
- Asset Turnover ratios

6

What are some ratios to measure financial position?

- Interest cover
- Gearing