Financial Management and Accounting Concepts Quiz

Assets that are expected to be consumed or converted into cash within a year.

A measure of profitability, showing the return generated relative to the investment made.

Net income represents the total revenue minus total expenses.

A foundational concept in finance stating that money has greater value the sooner it is received.

Spreads the cost of an asset over its useful life to match revenue generated by its use.

Working capital includes current assets and current liabilities but excludes long-term debt.

A measure of a company's operating performance, excluding certain expenses.

Provides a snapshot of a company's assets, liabilities, and equity at a particular moment.

Ensures expenses are recorded in the same accounting period as the revenue they help generate.

Measures the proportion of debt financing relative to equity financing in a company's capital structure.

Shows how much profit a company generates relative to its shareholders' equity.

Assumes a company will continue to operate indefinitely and requires assets and liabilities to be valued accordingly.