Answer Sheet for Unit 8

Aims and Objectives

Section 1: Financial Administration

Exercise 1: True/False Statements

1. TRUE
2. TRUE
3. FALSE
4. FALSE
5. TRUE

Exercise 2: Gap Filling

1. attributes
2. lifestyle
3. wouldn't
4. would
5. would
6. isn't
7. aren't
8. stock
9. aren't
10. don't

Exercise 5: Exposed Cloze

1. scored
2. score
3. below
4. sorts
5. serves
6. quite
7. ahead
8. above
9. mission
10. likely

Exercise 6: Cloze

1. invoice
2. receipt
3. credits
4. debits
5. journal
6. ledger
7. file
8. bookkeeper
9. accountant
10. auditor

Exercise 7: True/False Statements

1. FALSE
2. FALSE
3. TRUE
4. TRUE
5. FALSE
6. TRUE
7. TRUE
8. FALSE

Exercise 9: Multiple Choice Questions

1. assets
2. liabilities
3. invoice
4. receipt
5. ledger
6. budget
7. financial statement
8. cash-flow

Exercise 10: Cloze

1. have
2. an
3. be
4. you
5. are
6. of
7. on
8. large
9. the
10. by

Exercise 11: Selections

1. Fixed assets and liquid assets are the two different types of assets.
2. Fixed assets cannot be sold if they are needed for production.
3. Liquid assets are cash in hand or in the bank and things like cheques that can be turned into cash.
4. Depreciation is an accounting process applied to fixed assets.
5. A machine with a life of 5 years costing 10,000 euros would be written off, i.e. depreciated, as a cost of 2,000 euros per year.

Exercise 14: Selections

1. What is the difference between insolvent and bankrupt?
2. How is it possible to have good sales figures and a cash-flow crisis?
3. How can credit be controlled?
4. How can a company minimise the risk of bad debt?
5. Why not make the customer pay in advance?

Exercise 15: Selections

1. Insolvency and bankruptcy are similar but there is a legal difference.
2. If you sell a lot and the customers take a long time to pay you may have a cash-flow problem.
3. Efficient financial management is the key to controlling credit.
4. It’s a question of skilful management.
5. If you make the customer pay up front you risk losing their goodwill.

Exercise 16: Exposed Cloze

1. figures
2. tied up
3. court
4. tough
5. pressure
6. charge
7. short-term
8. goodwill

Exercise 18: True/False Statements

1. TRUE
2. FALSE
3. FALSE
4. TRUE
5. FALSE

Exercise 20: Multiple Choice Questions

1. somebody who writes in a newspaper about other people’s personal lives and affairs
2. photographers who follow famous people hoping to get a photo they can sell
3. a famous singer
4. someone who has died
5. a loan for the value of a property like a house
6. to pay the full amount of a financial obligation
7. to plan or invent a way of doing something
8. to drop suddenly in value
9. money and other possessions, assets
10. to obliterate

Exercise 21: Exposed Cloze

1. mind
2. exciting
3. steady
4. having
5. settle
6. after
7. but
8. else
9. account
10. root

Exercise 23: Cloze

1. having
2. where
3. also
4. into
5. best
6. in
7. like
8. back
9. care
10. called

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