Finance Skills for Managers - D076 Quiz

The primary purpose of financial management is to maximize shareholder value by making sound financial decisions.

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The three main financial statements are the income statement, the balance sheet, and the cash flow statement.

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The income statement shows a companys revenues, expenses, and profits over a specific period of time.

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The balance sheet provides a snapshot of a companys financial position at a specific point in time, showing assets, liabilities, and equity.

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The cash flow statement provides information about a companys cash inflows and outflows over a period of time.

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Working capital is the difference between a companys current assets and current liabilities.

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Net income = Total Revenues - Total Expenses

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Gross profit is total revenue minus the cost of goods sold (COGS), while net profit is gross profit minus all other expenses, including operating, interest, and taxes.

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