Business Finance Quiz 5

In what order should current assets be presented on a statement of financial position?

• Cash, bank, trade receivables, inventories

• Trade receivables, bank, cash, inventories

• Inventories, cash, bank, trade receivables

• Inventories, trade receivables, bank, cash

An increase in the expense of rent would lead to:

• A steepening of the FC line on a break-even graph

• An upward shift of the FC line on a break-even graph

• A steepening of the VC line on a break-even graph

• An upward shift of the VC line on a break-even graph

A definition of an accrual is an expense which is:

• Paid but not yet due

• Due but not yet paid

• Paid and overdue

• Unpaid and overdue

Which of the following are needed to calculate the annual straight line depreciation on a non-current asset?

• Cost, scrap value, price paid for delivery

• Cost, residual value, price paid for annual maintenance

• Cost, scrap value, expected life in years

If value of opening inventories increases, what happens to the value of gross profit?

• It decreases

• It increases

• It stays the same

• It gets closer to net profit

An increase in the selling price per unit will ALWAYS lead to:

• The TR line on a break-even graph becoming flatter

• The TR line on a break-even graph becoming longer

• The TR line on a break-even graph becoming steeper

• The TR line on a break-even graph becoming shorter

Total revenue is calculated as:

• Selling price per unit x closing inventory

• Selling price per unit x units sold

• Selling price per unit x units purchased

• Selling price per unit x net profit margin %

What does the statement of comprehensive income show?

• The profit or loss made by a business over a period of time

• The liquidity position of a business at a point in time

• The value of assets bought by a business over a period point in time

• The value of a business at a point in time

The formula for calculating gross profit is:

• Net profit + sales

• Sales – expenses

• Sales – cost of goods sold

• Cost of goods sold - sales

The liquid capital ratio is calculated as:

• CA – CL : inventories

• CL – inventories : CA

• CA – inventories : CL

• CL – CA : inventories