1. 3 types of financial statements?

Three common types of financial statements are the balance sheet, the income
statement, and the cash flow statement. The balance sheet shows the financial
position of a company on a particular date, it lists a company’s assets, its
liabilities and owner’s equity. The income statement shows how much money a
company makes and spends over a period of time. It lists total of sales, gross
profit, cost of goods sold, operating expenses, net profit. The cash flow
statement shows cash flow in and out of a company in a period of time. It lists
cash flow into 3 categories: operating activities, investing activities, financing
activities.
2. How r financial ratios classified?
Ratios can be classified according to the way they are constructed and their
general characteristics. By construction, ratios can be classified as a coverage
ratio, a return ratio, a turnover ratio and a component percentage. According to
their general characteristics, they can be classified into a liquidity ratio, a
profitability ratio, an activity ratio, a financial leverage ratio, a shareholder ratio
and a return on investment ratio.
3. 4 functions of money?
There are 4 main functions of money. Firstly, money serves as a medium of
exchange anything widely accepted in payment for goods, services or debts.
Secondly, Money is a measure of value. Money measures the value in units of
account as USD, UND or RMB. Thirdly, money functions as a store of value
because it can be saved to make purchases at a later time. Finally, money is a
standard of deferred payment. With the use of installment buying, this function
becomes more & more important.
4. 2 types of money?
There are two types of money: commodity money and token money.
Commodity money is defined as a useful good which serves as a medium of
economic exchange. Its value is about equal to the value of materials contained
in it. Whereas, token money is a means of payment whose value or purchasing
power is greater than the cost of production or value in use.
5. Functions of taxation?
The first, raise government revenue to finance government expenditure: defense,
education, health…. The second, act as a tool of fiscal policy. It is used to
regulate the economy like regulate aggregate demand, aggregate supply. The
third, each type of tax has its own function. For example: excise tax: tax is used
to restricts consumptions of some goods which is not good for health or
environment; Individual income tax is used to redistribute society’s income;
Customs duty is used to protect domestic industries and corporate income tax is
used to encourage capital investment.
6. Functions of central banks?
Most central banks in the present-day world perform one of the following
functions. Firstly, they serve as the government’s banker. As a banker to the
government, the central bank: collects and disburses government income,
manages the issues and redemption of government debts, advises the
government on all matters pertaining to financial activities and makes loans to
the government. Secondly, they act as the banker of the banking system. As a
banker to the banking system, the central bank: holds and transfers banks’
reserves, supervises operations of other banks in the economy, makes loans to
other banks and charges discount rates for these loans. Thirdly, they regulate the
monetary system for both domestic and international policy goals, and finally,
they issue the nation’s currency.
7. Ways of avoiding taxes on salaries?
There are a number legal ways to avoid tax on salaries. Firstly, companies often
give “perk” (such as company car or subsidized lunches) to highly - paid
employees instead of taxable money. It's known as "loophole in tax laws".
Secondly, “tax shelter” is a legal way avoiding tax by postponing the payment
until a later date. Thirdly, people find ways to deduct a certain amount of money
from taxable income (such as donation to charities). This way is known as "tax
deductible"
8. Ways of avoiding taxes on profit?
Companies have many ways to avoid tax on profits. Firstly, Companies with
unexpected profits can bring forward capital expenditure (buying new
machinery or building factories to use up all the profits), which is known as
“Making a tax loss”. Secondly, multinational corporations often set up head
offices in low-tax countries to reduce tax liability. These countries are called
"Tax havens". Thirdly, "money laundering" is a common way used by criminal
organizations. They pass money through a number of companies in complex
transactions to disguise the origin of the money from Police & tax inspectors.
9. Advantages and disadvantages of world trade?
World trade has brought both advantages and disadvantages for importing
nations. Firstly, consumers of the importing countries can choose to buy either
imports or domestic goods. And the increased competition between domestic
goods and imports causes prices to become lower. Secondly, imposing tariffs on
imports creates revenue for the government. However, importing goods creates
challenges to local producers. They have to face more competition from foreign
competitors to keep their market share.
World trade brings great advantages to exporting nations. Firstly, when they
export goods, they receive money, thus their economies tend to grow. Secondly,
increased production for exporting helps create more jobs for the population.
Moreover, the development (expansion) of world trade leads to the development
of other industries such as transportation, distribution, marketing and insurance.
In conclusion/ In general, the economy can grow dramatically thanks to the
increased exporting activities.
10. Why and how government restrict imports?
The first reason is to protect domestic employment. Allowing cheap imports into
a country may destroy jobs by forcing domestic companies to cut costs, lay off
workers, or even go out of business. Government restricts imports in order to
shield domestic infant industries from foreign competition. Young domestic
industries need time to mature enough to compete with large foreign producers.
Finally, restricting imports prevents the country from depending on these
imports and allows greater reliance on domestic production.
To restrict imports the Government can use quota systems; tariffs; or subsidies.
For example, in 1960 the United States imposed a trade embargo on Cuba to
protest its revolutionary government’s seizure of American-owned property.
11. Why and how government encourage exports?
Firstly, Governments subsidize exports because they can improve Employment
opportunities when exports require more manpower. Secondly, encouraging
exports also helps increase income, from which the standard of living can be
better. The last reason is wealth often accrues to exporting countries.
To encourage exports, Government may be programs that provide marketing
information, establish trade missions, subsidize (trợ giá) exports and provide tax
benefits or incentives. For example, Government subsidies allow companies to
export their products and sell them cheaply overseas, which is known as
dumping.
12. Reasons for imposing trade barriers?
Firstly, they commonly use trade barriers to protect domestic employment and
relatively young domestic industries that are not matures enough or large
enough to compete with larger, more mature foreign producers. Secondly, they
want to prevent unfair trade practices of foreign firms like dumping. Finally,
using trade barriers in order to protect firms and industries that produce output
vital to the security and defense of the nation.
15. Tax evasion? Examples of tax evasion?
Tax evasion means using illegal ways to avoid the payment of tax. There are 2
main ways for both individuals and firms to evade taxes. Firstly, Illegal
nonpayment. By this way, freelancers or people with part-time jobs whose
incomes are much more difficult to control than that of companies’ employees
often don’t declare their incomes to the tax offices, thus they evade paying taxes
on personal incomes as well as paying payroll taxes. Imports which are not
declared by the importer can evade custom duty tax too. Secondly, Illegal
underpayment. By making false declarations about costs, firms can evade
corporate income tax, VAT, customs duty…
16. Sources of fi. Data used in fi. Analysis?
Data needed in financial analysis is from many sources: financial statement data,
market data, economic data and so on. Firstly, the primary source is the data
provided by the company in its annual reports and required disclosures.
Secondly other information such as the market prices of securities is found in
the financial press and the electronic media daily, etc. Another source is
economic data such as GDP or CPI, as well as events that helps explain the
company's present condition, etc.
17. How can a central bank implement the monetary policy?
The central bank uses 3 monetary policy tools to increase or decrease the money
supply in the economy: reserve requirements; open market operation and interest
rates. To increase the money supply, it lowers the reserve requirements, discount
rates or buys government bonds. To decrease the money supply, it increases the
reserve requirements, discount rates or sells government bonds.
18. Functions of commercial banks?
Functions of commercial banks are to create money in circulation in saving
banks and share-drafts in credit unions; to maintain and create demand deposits
by loans and investments.
19. Differences bw a progressive and regressive tax?
Progressive tax is a tax levied at higher rate on higher income while regressive
tax is the tax that takes larger percentage in lower income and lower percentage
in higher income. Progressive tax rate depends on income, so it can redistribute
society income but regressive tax rate is often the same for everyone so it can be
unfair for the low income people.
20. What is the acc process/responsibilities of an accountant?
The accounting process produces accounting information used by decision
makers in making economic decisions and taking specific actions. These
decisions and actions result in economic activities that continue the cycle. The
accounting process consists of the following steps:
1. Identify transactions and collect source documents.
2. Record transaction for the first time in a journal/ book of original entry.
3. Post/ Transfer information from journal to ledger accounts periodically.
4. Make a trial balance to make sure that Total credits are equal to total
debits.
5. Use information in the ledger accounts to make financial statements.
21. What is fi accounting information?
Financial accounting shows information about financial resources, obligations,
financial activities of a business in financial statements. Its information is used
by internal and external users such as creditors, investors, government,
managers, employees for different purposes. For example: Potential investors
need financial accounting information to decide whether to place their scarce
resources or not. Creditors need financial accounting information to decide
whether to place their resources or not or to lend out or not.
22. Tax acc information?
Tax accounting is based on financial accounting information and it is adjusted to
conform the tax reporting requirements. Its information is used by managers or
individuals to pay tax and tax authority to collect tax.
23. Management acc information?
Management accounting information is the development and interpretation of
financial accounting information to assist management in running the business.
Its information is used only by internal people such as managers and employees.
Managers use accounting information to know the financial performance of the
business, set overall goals, decide whether to introduce a new line of products or
not and in making virtually all types of managerial decisions.
24. Fi analysis? Its purposes?
Financial analysis is the selection, evaluation, and interpretation of financial
data, along with other pertinent information, to assist in investment and financial
decision making. Financial analysis may be used internally to evaluate issues
such as employee performance, the efficiency of operations, and credit policies,
and externally to evaluate potential investments and the credit-worthiness of
borrowers, among other things.
25. Theory of absolute advantage?
The theory of absolute advantage states that countries import products most
efficiently manufactured abroad and export products most efficiently produced
domestically
26. Theory of comparative advantage?
David Ricardo’s theory is theory of comparative advantage. The theory of
comparative advantage states that an exporting country doesn’t have to be the
most efficient producer, it’s only more efficient than the country importing the
product
28. 4 forms of trade barriers
4 forms of trade barriers are: tariffs on imports, quotas on imports, subsidies and
embargo. The first, a tariff is a tax that is paid on the import of goods and
services to increase the government’s revenue, protect domestic companies. The
second, a quota is simply a quantity restriction placed on a good, service, or
activity. The third, a subsidy is a type of government expenditure targeted
towards individuals and households and often placed to protect domestic
industries. The fourth, embargoes are an order of the government prohibiting the
import or export of anything with another country.