Finance: Entrepreneurship

The three essential financials statements are:

• Income Statement, Balance Sheet, and Cash Flow Statement

• Income Statement, Checking Account Ledger, Balance Sheet

• Balance Sheet, Sales Pro Forma, Income Statement

• Cash Flow Statement, Sales report, Checking Account Ledger

The Income Statement...

• shows whether the difference between revenue (sales) and expenses (costs) is a profit or a loss over a given period.

• shows a "snapshot" at a particular point in time of what the company has today (assets), how much it owes (liabilities), and what it is currently worth (shareholder equity).

• tracks the movement of cash into (cash inflows) and out of (cash outflows) the company over a specific period of time.

• is like a cash register for the company

The Balance Sheet...

• tracks the movement of cash into (cash inflows) and out of (cash outflows) the company over a specific period of time.

• shows a "snapshot" at a particular point in time of what the company has today (assets), how much it owes (liabilities), and what it is currently worth (shareholder equity).

• shows whether the difference between revenue (sales) and expenses (costs) is a profit or a loss over a given period.

• is also known as a profit and loss statement.

The Cash Flow Statement...

• subtracts the Cost of Goods Sold (COGS) and expenses from the total revenue to give you a new income figure, which will either be a profit or a loss.

• is also known as a profit and loss statement.

• shows a "snapshot" at a particular point in time of what the company has today (assets), how much it owes (liabilities), and what it is currently worth (shareholder equity).

• tracks the movement of cash into (cash inflows) and out of (cash outflows) the company over a specific period of time.

One way to help keep a positive cash flow is...

• collect cash as soon as possible.

• pay your bills as soon as you receive the invoice.

• buy inventory early, or in the off-season, and bulk up your inventory to plan for busy seasons ahead.

• sell more to customers who use credit.

Assets includes...

• Items (tangible and intangible) a company owns that have monetary value.

• Tangible items that a company owns that have monetary value, but not intangible items such as accounts receivable that have not been collected on yet.

• money that has been invested in the business plus the cumulative net profits and losses the company has generated.

• capital stock or owners stock

Liabilities are...

• all debts that a company has that must be paid

• only the debts that are payable in one year or less.

• only the debts that are to be repaid in more than one year.

• the cumulative amount of profit retained by the company and not paid out in the form of dividends to the owners.

Melissa sells homemade cupcakes for $2 each.  Each cupcake cost $1 to make. What is the amount of profit Melissa makes if she sells 50 cupcakes?

• $50
• $75
• $100
• $175

Tags

CCSS.3.OA.D.8

Dexter bought a video game on sale for $17.99, and then he sold it online for $32.50. What was Dexter's profit on the sale of the video game?

• $14.55
• $50.49
• $14.51
• $6.12

If a business's costs exceeds it sales revenue, it will experience a ........?

• loan

• profit

• loss

• debt