Term
|
Definition
Value Added Tax.
A company can reclaim the VAT-part of all items they purchased from the government.
A company must transfer the VAT-part of all items which they sold to the government.
As a result the government receives only the VAT which corresponds with the value a specific company adds. |
|
|
Term
Calculate the amount of VAT for the next purchase:
An Ipad for €479,- including 21% VAT |
|
Definition
| € 83.13 (divide the amount by 121 and then multiply by 21). |
|
|
Term
| Who should pay the VAT and whom not? |
|
Definition
| Consumers pay for the VAT, companies eventually transfer it to the tax office (government). |
|
|
Term
| How can the owner's equity increase? Mention 2 ways.. |
|
Definition
| By making a profit or transfer extra funds from the owner's private account to the business account |
|
|
Term
| Why is VAT called VAT, can you explain? |
|
Definition
Each company makes sure that they transfer VAT to the tax office. Note this amount is precisely corresponding to the VAT over the added value of that company.
If a company makes a purchase they can get a VAT refund.
If a company sells for instance goods they have to transfer the VAT part to the tax office.
Hence if they bought something with value 10 VAT and resold it with value 25 VAT. As a result they only pay 15 to the tax office. The VAT belonging to their added value. |
|
|
Term
| What's the difference between a balance sheet and a statement of changes. |
|
Definition
| a balance sheet shows how the company has acquired its assets and what the company has done with these assets. |
|
|
Term
| What's an other name for loan capital |
|
Definition
|
|
Term
|
Definition
| The debt of the company to the owner |
|
|
Term
|
Definition
|
|
Term
| Mention 4 different Inventory examples |
|
Definition
curtains, floor coverings. lightning, office furniture
e.g. fitting up of the shed |
|
|
Term
| You can finance a company by |
|
Definition
- the owner's money (owner's equity)
- money borrowed from others (loan capital) |
|
|
Term
true or false:
Expenses increase the owner's equity |
|
Definition
| False, expenses reduce the OE |
|
|
Term
True or False:
If the owner invests more private money into the company, the Owner's equity will increase |
|
Definition
| True, then the company should repay a bigger amount to the owner in the (near) future. |
|
|
Term
|
Definition
a customer who did not pay us yet.
They already received an invoice and already received our product or service. |
|
|
Term
A production company provide a service or manufacture goods which they make themselves.
They do not calculate the gross profit. Why not? |
|
Definition
Because they make the products/services they provide themselves so they do not first purchase these from others.
Turnover less all costs is equal to the net profit. |
|
|
Term
True of False
A trading company does not manufacture goods/services themselves |
|
Definition
|
|
Term
True of False:
A trading company calculates straight to net profit |
|
Definition
| False, they first calculate the gross profit before they calculate the net profit (see Ch5 for details). |
|
|
Term
Mourad wants to start his own hairdresser’s salon. He has saved up an amount of € 20,000 for this and also wants to borrow € 14,000 from the bank. He uses the money for the purchase of hairdresser’s chairs, mirrors, equipment carts, cabinets, desk, chairs for the waiting area, etc.
Below you see a survey of the goods he has purchased with his total capital.
Hairdresser’s inventory € 23,500
PC with printer € 1,100
Consumables € 5,600
Cash register € 2,600
Cash € 1,200
How big is Mourad’s own equity?
A. € 34,000
B. € 21,200
C. € 20,000
D. € 6,000 |
|
Definition
|
|
Term
If KPN supplies your company, but you did not yet pay the invoice. In your balance sheet KPN will appear as a:
- debtor or a creditor? |
|
Definition
KPN will be one of the creditors.
Your company still has a debt. In the near future the invoice needs to be paid. |
|
|
Term
| Private withdrawals do not affect the gross profit, but they do affect the net profit of an enterprise. |
|
Definition
| Incorrect (only OE is lowered) |
|
|
Term
| A profit and loss account provides insight into the causes for the change in the owner’s equity |
|
Definition
|
|
Term
| A profit and loss account states stock quantities |
|
Definition
| No, this will show om a balance sheet. |
|
|
Term
| Customers who still need to pay money are called creditors |
|
Definition
| No debtors. The money is not yet transferred to the bankaccount of the company. |
|
|
Term
| Does VAT influence the profitability of a company? |
|
Definition
| No such thing. The company is only the 'vehicle' to transfer the tax to the authorities. |
|
|
Term
| Give an example of a flow quantity |
|
Definition
Inventory
(a quantity that is renewed over a certain time). |
|
|
Term
| What's the opposite of a flow quantity? |
|
Definition
|
|
Term
| What changes on a balance sheet when something is damaged? |
|
Definition
At the left hand side something will change: e.g. Car or coffee machine.
At the right hand side OE will drop. |
|
|
Term
| What does a balance sheet state? |
|
Definition
What the value is of all different assets
How big the debt of the company are (liabilities = OE + loans) |
|
|
Term
| Give a definition of Profit&Loss account |
|
Definition
| a survey of costs and revenues in a certain period |
|
|
Term
| I studied Chapter 6 well. |
|
Definition
| I liked using the flashcards !! |
|
|
Term
| We could change the way we study by preparing flashcards for the whole class. |
|
Definition
Perhaps 3 students could cover a course.....
so all courses are covered and summarized in a different way. (Teacher can check the input). |
|
|
