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Final Accounts
Junior Cycle Business Studies
| Trading account | shows whether the company makes a gross profit or loss |
| Profit & Loss account | shows whether the company makes a net profit or loss |
| Income statement | comprises of a trading account section and profit and loss account section |
| Balance sheet | shows a list of assests, liabilities and capital of a business on a particular date |
| Statement of financial position | is also called the Balance Sheet |
| Sales | is the income received from selling your product |
| Trading period | is the length of time to which the final accounts relate, usually 1 year |
| Opening Stock | is the value of goods in stock at the start of the trading period |
| Fixed Asset | items of value which the business owns which will last for the longterm e.g. Machinery, Buildings, Motor Vehicles |
| Current Asset | items of value that change within the yeare.g. Cash in hand, Bank, Closing Stock, Debtors |
| Current Liabilities | money owed by the business that must be repaid within 1 year e.g. Creditors, Bank Overdraft |
| Working capital | is calculated by subtracting Current Liabilities from Current Assets |
| Dividend | proportion of net profits given to shareholders and is calculated as a percentage of issued share capital |
| Reserves | is the amount of profit retained in the business and also referred to profit & loss balance |
| Issued Share Capital | is the actual amount of shares already issued to shareholders |
| Depreciation | is the reduction in the value of fixed assets due to age, use, wear & tear |
| Purchases | is the cost of goods bought in during the trading period with the intent to resell on |
| Carriage inwards | is the cost of transporting goods into the business |
| Import duties | is the tax on imports |
| Cost of goods available for resale | is calculated by adding opening stock, purchases, carriage inwards and import duties |
| Closing stock | is the value of goods in stock at the end of the trading period |
| Cost of sales | is calculated by subtracting closing stock from cost of goods available for resale |
| Gross profit | occurs when sales are greater than cost of sales figure |
| Gross loss | occurs when sales are less than cost of sales figure |
| Expenses | are the day to day running costs for a business e.g. wages, light & heat, insurance, depreciation |
| Net profit | occurs when gross profit is greater than total expenses |
| Net loss | occurs when gross profit is less than total expenses |
| Total net assets | occurs when you add working capital to total fixed assets |
| Long term liabilities | money owed by the business that must be repaid over the longterm |
| Authorised Share Capital | the maximum amount of shares a company can issue |
| Capital employed | should be equal to total net assets |
| Capital | the total amount of money invested in the business by its owners |
Created by:
deborahh
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