Help !!--- Questions for Busines (1 Viewer)

[chris42]

Hey all,

After doing some revising I found some things that weren't all that clear to me, especially in the financial
management section.

Have any of you heard of the financial planning cycle.. Its in the business studies text book by D. Suykes. and
i'm not sure if its that important to study ?

Venture capital is is a debt finance or equity finace ??

Net Earnings does it equal net profit ?

And the different financial statements, Revenue, Cash Flow Statement, and Balance sheet.. Which ones show
the businesses liquidity and which ones show the businesses solvency ?


Thanks for your help..

Chris.

 

[chris42]

Yup thats the one

 

[ezzy85]

Originally posted by chris42
Hey all,

After doing some revising I found some things that weren't all that clear to me, especially in the financial
management section.

Have any of you heard of the financial planning cycle.. Its in the business studies text book by D. Suykes. and
i'm not sure if its that important to study ?

Venture capital is is a debt finance or equity finace ??

Net Earnings does it equal net profit ?

And the different financial statements, Revenue, Cash Flow Statement, and Balance sheet.. Which ones show
the businesses liquidity and which ones show the businesses solvency ?


Thanks for your help..

Chris.

planning cycle is that big one. i usually study that at the end and ive never seen it in a past paper.

venture capital is when someone funds your project. so im guessing its a form of equity?

net earning, retained profits, retained earning all = net profits.

Liquidity is whether or not the company can pay its debts as they fall due. so you would use a cashflow statement for that because you can see the cash flowing throughout the business.

Solvency is whether or not you can pay your debts in the long run. so you would use a balance sheet because its got all your assets and your long term liabilities.

 

[chris42]

Thanks for that, that was really helpful.. I would guess revenue statement shows liquidity as well am I right?

 

[ezzy85]

revenue statement is for a certain period of time, so i guess it can be for short term. im not too sure about it though.

 

[chris42]

Ok, Most likely would be right I would think

 

[AGB]

Originally posted by chris42


Have any of you heard of the financial planning cycle.. Its in the business studies text book by D. Suykes. and
i'm not sure if its that important to study ?

yeah it is important to study, however you only need remember the 9 points. it is straight out of the syllabus, so they can quite easily test you on it.

Venture capital is is a debt finance or equity finace ??

venture capital is neither...it is the 'other' category

Net Earnings does it equal net profit?

yes it does

And the different financial statements, Revenue, Cash Flow Statement, and Balance sheet.. Which ones show
the businesses liquidity and which ones show the businesses solvency ?

revenue shows financial performance. balance sheet shows financial position. a cashflow statement just shows the cash in and out of the business.

both liquidity and solvency are shown on the balance sheet

 

[chris42]

Thanks, that cleared me up on the revenue query

 

[arn_e]

i good definition 4 venture capital

Money invested on a high risk project that is high risk

ie.will result in high profits or high losses

eg.Deep sea mining co, OR oil thingyz u know when they look for oil

 

[AGB]

Re: Re: Help !!--- Questions for Busines

Originally posted by ezzy85


net earning, retained profits, retained earning all = net profits.

thats actually not totally correct...retained profits and retained earnings are the same thing, but are not the same as net profit.

retained profit = net profit - dividends paid to shareholders

 

[chris42]

oh...ok that changes things a bit.
Thanks for that bit of info

 

[chris42]

I heard from the advice line that net profit is the one you want to use for the Return on owners equity instead of retained profit, what do you all use, Retained profit over owners equity or net profit over owners equity