Business Economics first 3 weeks

Which of the financial statements below doesn't belong to the three main Financial Statements?

• Balance Sheet

• Statement of Operations

• Income Statement

• Statement of Cashflows

Which of the items below doesn't belong on the profit & loss statement?

• Depreciation

• Cost of Goods Sold

• Personnel expenses

• Principal Payment

True or false: a change in equity at the end of the year is the result of the net profit of a company throughout the year

• True

• False

In the sum-of-the-year-digits method for depreciating assets they:

• depreciate assets by an equal amount every year

• depreciate more during the first years than in the later years

• depreciate annually based on a decreasing weighting factor based on the economic life remaining

• None of the answers above is correct

Calculate the depreciation costs:

Value at 1st of Januari = €300.000,-

Economic life = 10 years

Residual value = €25.000,-

Method used = straight line depreciation

• €27.500,-

• €25.000,-

• €30.000,-

• €55.000,-

A reserve is:

• A charge of estimated expenses

• An appropriation of profit for a specific purpose

• The distribution of profits to shareholders

• The amount of net income left over for the business after it has paid out dividends to its shareholders.

Which of the following is not a category of a ratio?

• Return on assets

• Profitability

• Solvability

• Liqudity

Which of the statements below best describe the solvency category of ratios?

• Closely related to sales, important condition for a firm's continuity

• Provides information about a company's ability to meet its short term financial obligations

• Measures the extent of a company’s financial leverage

• Denotes a company's ability to meet its long-term financial obligations.

A business' financial structure should be flexible: able to adapt to fluctuating financial circumstances. If we talk about qualitiative elasticity that means:

• The amount of available resources measured in relation to access to the capital markets

• Enables the business to replace one type of capital for another ​

• The sensitivity of the demand of capital to changes in interest rates

• None of the above is correct

Calculate the end of year cash:

- beginning cash: = €10.000,-

- Principal Payment = €5.000,-

- Interest = €1.000,-

- Provision = €100.000,-

- Depreciation = €5.000,-

- Revenue = €100.000,-

- Cost of Sales = €55.000,-

- Purchases of goods = €65.000,-

- Taxes paid = €5.500,-

End of year: ....

• €43.500,-

• €28.500,-

• -€56.500,-

• €33.500,-

• None of the answers above is correct