after i lost my job, i was living on social security for three months. This was difficult, because the amount was much lower than the salary i had before.
i used to work as a salesperson, but i wasn’t very successful, so i didn’t earn much commission.
if the company makes 10% more than last year, we’ll all get a bonus at the end of the year
it’ll take me at least 25 years to repay the mortage on my house
many European countries now have the same currency, the euro.
my wages aren’t very good, so i do a lot of over time.
nearly 40% of everything i earn goes to the government as tax
the owner has just increased the rent on our flat by 15%
when i retire, my pension will be 60% of my final salary
false bank deposits aren’t classified as money.
true people earning wages get paid more often than people earning a salary.
false people working on commission always get paid the same amount.
True when you stop working at the end of your career, you receive a pension.
false most people pay a rent and mortgage.
bookkeepers are a people who prepare a company’s day to day accounts
accountants are a people who prepare financial statements
internal auditors are a company employees who cheeck the financial statements
external auditors are a expert accountants working for independent firms who review companies financial statements and accounting records
goodwill is measured as the excess of the cost of the purchase over the fair value of the identifiable net assets ( assets less liabilities) purchased.
tangible assets are assets with a physical existence (things you can touch) such as property, plant, and equipment. Tangible assets are generally recorded at their historical cost less accumulated depreciation charges ( the amount of their cost that has already been deducted from profits. This gives their net book value).
intangible assets include brand names legally protected names for a company’s products ; patents exclusive rights to produce a particular new product for a fixed period ; trade marks names or symbols that are put on products and cannot be used by other companies. Networks of contracts, loyal customers, reputation, trained staff or human capital and skilled management can also be considered as intangible assets.
valuation manufacturing companies generally have a stock of raw materials, work in process partially manufactured products, and products ready for sale. These are various ways of valuing stock or inventory, but generally they are valued at the lower of cost or market, which means whichever figure is lower : their cost the purchase price plus the value of any work done on the items or the current market price. This is another example of conservatism : even if the stock is expected to be sold at a profit, you should not anticipate profits.
Because it is difficult to give an accurate value for any of these things, companies normally only record tangible assets. For this reason, going concern should be worth more on the stock exchange than simply its net worth or net assets: assets minus liabilities.
If a company buys another one at above its net worth because of its intangible assets the different in price is recorded under assets in the balance sheet as goodwill.
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