Summary: Financial Management

Study material generic cover image
  • This + 400k other summaries
  • A unique study and practice tool
  • Never study anything twice again
  • Get the grades you hope for
  • 100% sure, 100% understanding
Discover Study Smart
Remember faster, study better. Scientifically proven.
Trustpilot Logo

Read the summary and the most important questions on Financial management

  • 1 Ratio

  • 1.3 Edubook

    This is a preview. There are 1 more flashcards available for chapter 1.3
    Show more cards here

  • Ratio analysis makes connections between various elements of the annual account, which gives insight into the financial health of a business

    Correct
  • By once comparing the key figures from a ratio analysis to relevant standards, a clear picture can be formed of a business's financial health.

    Incorrect
  • Historical analysis means that key figures of a business are calculated during multiple moments of a certain period and are compared to each other.

    Correct
  • In case of a lack of clear standards for assessing the calculated financial ratios of a business, the financial ratios could be compared to key figures of business from other industries.

    Incorrect
  • An advantage of a ratio analysis is that it is guaranteed to give a good representation of reality.

    Incorrect
  • 1.3.1 Liquidity ratios

    This is a preview. There are 5 more flashcards available for chapter 1.3.1
    Show more cards here

  • Static liquidity can be determined by means of various ratios:

    • net working capital
    • current ratio
    • quick ratio
  • Liquidity ratios are intended to give investors an idea of the extent to which a business can meet its financial obligations in case of liquidation.

    Incorrect
  • Dynamic liquidity is preferable to static liquidity.

    Correct
  • The net working capital is an example of a dynamic liquidity ratio.

    Incorrect
  • If the current ratio is lower than 1, there is a positive net working capital.

    Incorrect

To read further, please click:

Read the full summary
This summary +380.000 other summaries A unique study tool A rehearsal system for this summary Studycoaching with videos
  • Higher grades + faster learning
  • Never study anything twice
  • 100% sure, 100% understanding
Discover Study Smart