UNIT 4.

LESSON 3
I. Choose the best response.
1. A statement of _________ helps you keep track of your business's finances.
A. cash flow B. cash flowing C. money flow

2. What's the opposite of an asset?

A. Cash B. A liability C. A liaison

3. The breakeven point in sales dollars can be calculated by _________ a company's

fixed expenses by the company's contribution margin ratio.
A. dividing B. devising C. demising

4. Our company's _________________ ( = not fixed) expenses are approximately

$45,000 per month.
A. various B. variable C. veritable

5. "Liquid" assets often refer to _________.

A. credit B. cash C. checks

6. A flat-rate plan __________ marginal costs.

A. elaborates B. takes C. eliminates

7. In accounting, a cost that does not _________ ( = change) with the level of production
or sales is referred to as "……………..".
A. vary B. variable C. variety

8. There are two types of profit: gross profit and __________.

A. net profit B. non-gross profit C. netto profit

9. "Net profit after taxes" is what's called "the bottom line". It's the _________ after
everything has been subtracted.
A. netto income B. gross income C. net income

10. A __________ of an item in account books (because it no longer has any value) is
what's known as a "write-off".
A. cancel B. cancellation C. constellation

II. Match each definition with the letter of one of the following:

a - balance sheet, b - liquid assets, c - liability, d - net income, e - property, f - payroll, g -

equity, h - journal, i - cash flow, j - expense
1. a list of all employees and their wages

2. an accounting record where all business transactions are INITIALLY entered

3. money that is spent to purchase goods or services provided by someone else

4. a detailed summary of a person's or a company's financial condition at a specific point

in time, taking into account their assets, liabilities, etc.

5. something that is legally owned by a person or company

6. an obligation to settle a debt; money owed to someone

7. this word has 2 meanings: "stock (shares)" and "net worth"

8. the balance of cash receipts minus cash payments over a given period of time

9. cash or something that is easily convertible into cash

10. money remaining after all expenses and taxes have been paid