Business Basics for PR review #1

What's the main responsibility of financial management?

• To "cook the books"

• To keep a company's balance sheet at 0

• To ensure business assets earn a return higher than the cost of borrowing

Non-current assets are:

• Long-term assets like property, plant and equipment

• Assets like goodwill and brand reputation that are hard to put a $ figure on

• Short-term assets like inventory and accounts receivable used int the day-to-day operations

• Working capital accounts

Current assets are

• Things like goodwill and brand reputation that are hard to put a $ value on

• Short-term assets like inventory and accounts receivable used in day-to-day operations

• Long-term assets like property, plant and equipment

• Equity accounts

The following are considered intangible assets

• Brand

• Customer goodwill

• Reputation

• All of the above

Trade or accounts receivables are

• Invoices for purchases or services provided that haven't been paid yet

• Current assets

• Part of a business's working capital accounts

• All of the above

True or False: Liability accounts are comprised of both non-current (long-term) debt and current (short-term) debt

• True

• False

Equity is the value of what is owned by...

True or false: revenue refers to the gross amount a business earns from the sale of its products or services, whereas profit for the year is what's left when taxes and other expenses are subtracted from revenue

• True

• False

Where to PR Agencies' revenues come from?

• Billable hours only

• Client fees

• Stellar PR work

• Advertising

What types of things go into calculating client fees?

• Billable hours

• Hard costs like rent and utilities as well as administrative costs

• Subscription costs for services like Meltwater

• All of the above