Match the terms below with the correct definitions.
-The final figure on the income statement
A)Property and equipment
B)Reversing entries
C)Gross profit
D)Current ratio
E)Working capital
F)Net income or net loss
G)Net sales
H)Income from operations
I)Long-term liabilities
J)Liquidity

Question

Quizplus · Accepted Answer

Net income or net loss is the final figure on the income statement, which represents the profit or loss of a company over a specified period of time.

Answer: A
 Property and equipment are long-term assets that a company uses to generate revenue, such as machinery, buildings, and vehicles.

Answer: C
 Gross profit is the revenue generated by a company minus the cost of goods sold, which represents the profit earned from selling products or services before deducting operating expenses.

Answer: D
 The current ratio is a financial ratio that compares a company's current assets to its current liabilities, which indicates the company's ability to pay its short-term debts.

Answer: E
 Working capital is the difference between a company's current assets and its current liabilities, which represents the funds available to a company for its daily operations.

Answer: G
 Net sales are the total revenue generated by a company from sales after deducting sales returns, discounts, and allowances.

Answer: H
 Income from operations is the revenue generated by a company minus its operating expenses, which represents the profit earned by a company from its core business operations.

Answer: I
 Long-term liabilities are debts and obligations that a company owes for a period longer than one year, such as bonds payable and long-term loans.

Answer: J
 Liquidity is a measure of a company's ability to convert its assets into cash quickly to meet its short-term obligations.

Match the Terms Below with the Correct Definitions