Y8 Business Studies - C6 Business Accounting

What are accounts in a business?

• Financial records of a firm's transactions kept up to date by accountants.

• Physical inventory of a firm's products.

• Marketing strategies of a firm.

• Employee records of a firm.

Which document is a written order to a bank to pay a stated amount of money to a person or business?

• Purchase orders

• Cheque

• Invoice

• Credit note

What is the formula for calculating Gross profit?

• Gross profit = Sales revenue - Cost of goods sold

• Gross profit = Sales revenue * Cost of goods sold

• Gross profit = Sales revenue + Cost of goods sold

• Gross profit = Sales revenue / Cost of goods sold

Who wants to see whether the company can afford to pay their loans back or not?

• Other companies

• Government

• Creditors

• Shareholders

What does the balance sheet show?

• Only the current assets of a business

• Only the fixed assets of a business

• Assets and liabilities of a business at a particular time

• Only the long-term liabilities of a business

What is the purpose of the Current ratio?

• To see how much cash a business must pay off all its long-term debts

• To see how much cash a business must pay off all its short-term debts

• To see how much revenue a business has generated

• To see how much profit a business has made in the current year

What is the purpose of the Gross profit margin ratio?

• To see how much cash a business must pay off all its short-term debts

• To see how much revenue a business has generated

• To see if added value is increasing or costs have fallen

• To see how much profit a business has made in the current year

What is the purpose of a Credit note?

• To send when the firm has received its goods

• To request for payment from the firm

• To request for buying products

• To issue if a mistake has been made to the invoice

What is the purpose of a Delivery note?

• To request for payment from the firm

• To issue if a mistake has been made to the invoice

• To send when the firm has received its goods

• To issue after an invoice has been paid

What is the purpose of a Receipt?

• To issue after an invoice has been paid

• To send when the firm has received its goods

• To issue if a mistake has been made to the invoice

• To request for payment from the firm