A2 - Business - Interpreting published accounts

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  • Created by: jkav
  • Created on: 13-11-15 11:44
Liquidity
A business's ability to meet short-term cash payments on time.
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Current ratio
A measure of the ability of a business to meet short-term debts.
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Acid test ratio
A measure of the ability of a business to meet short-term debts from liquid assets.
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Profitability
The relationship between business's profits and sales revenues.
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Return on capital employed (ROCE)
A measure of how efficiently a business is using its capital to generate profits
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Asset turnover
A measure of how effectively a business is using its assets to generate sales.
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Capital employed
Capital employed = total equity + non-current liabilities. It is the total capital invested in the business from long-term sales.
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Inventory (or stock) turnover
A measure of how many times per year a business turns over its stock through sales.
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Payables (creditor) days
A measure of the average number of days taken to pay suppliers.
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Receivables (debtor) days
A measure of the average number of days taken by a business to collect its debts from customers.
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Gearing Ratio
The percentage of capital employed that comes from non-current liabilities.
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Shareholder ratios
Ratios that help measure the value of the return received by shareholders.
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Dividends per share
The number of pence per share received by shareholders.
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Dividend yield
A measure of the return received on an investment, expressed as a percentage of the current market price of the share.
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Other cards in this set

Card 2

Front

A measure of the ability of a business to meet short-term debts.

Back

Current ratio

Card 3

Front

A measure of the ability of a business to meet short-term debts from liquid assets.

Back

Preview of the back of card 3

Card 4

Front

The relationship between business's profits and sales revenues.

Back

Preview of the back of card 4

Card 5

Front

A measure of how efficiently a business is using its capital to generate profits

Back

Preview of the back of card 5
View more cards

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