IB BUSINESS MANAGEMENT FINANCE AND
ACCOUNTS 3.4 FINAL ACCOUNTS
COMPREHENSIVE REVIEW 2026 FULL
QUESTIONS AND VERIFIED ANSWERS
◉ Profit and loss account Answer: Also known as the income statement,
shows the records of income and expenditure flows of a business over a
given time period
◉ Costs of goods sold Answer: The direct cost of producing or
purchasing the goods that were sold during that period
◉ Dividends Answer: The sum of money paid to shareholders decided
by the board of directors of a company
◉ Gross profit Answer: = sales revenue - cost of sales
◉ Cost of sales Answer: = opening stock + purchases - closing stock
◉ Net profit before interest and tax Answer: = gross profit - expenses
◉ Net profit before tax Answer: = net profit before interest and tax -
interest
,◉ Net profit after interest and tax Answer: = net profit before tax -
corporate tax
◉ Retained profit Answer: = net profit after interest and tax - dividends
◉ Profit and loss account table Answer:
◉ Balance sheet Answer: Outlines the assets, liabilities, and equity of a
firm at a specific point in time
◉ Fixed assets Answer: Long-term assets that last a business more than
12 months
◉ Current assets Answer: Short-term assets that last in a business for up
to 12 months
◉ Long term liabilities Answer: Long term debts or borrowings payable
after 12 months by the business
◉ Current liabilities Answer: Short term debts that are payable by the
business within 12 months
◉ Working capital Answer: = total current assets - total current
liabilities
, ◉ Total assets less current liabilities Answer: = (total current assets +
total fixed assets) - total current liabilities
= fixed assets + working capital
◉ Net assets Answer: = (total assets less current liabilities) - long term
liabilities
◉ Equity Answer: = share capital + retained profit
= net assets
◉ Balance sheet table Answer:
◉ Intangible assets Answer: Fixed assets that lack physical substance
and are non-physical in nature
◉ Patents Answer: Provide inventors with the exclusive rights to
manufacture, use, sell or control their invention of a product
◉ Goodwill Answer: The value of positive or favorable attributes that
relate to a business
◉ Copyright laws Answer: Laws that provide creators with the
exclusive right the production and sale of their artistic and literary work
ACCOUNTS 3.4 FINAL ACCOUNTS
COMPREHENSIVE REVIEW 2026 FULL
QUESTIONS AND VERIFIED ANSWERS
◉ Profit and loss account Answer: Also known as the income statement,
shows the records of income and expenditure flows of a business over a
given time period
◉ Costs of goods sold Answer: The direct cost of producing or
purchasing the goods that were sold during that period
◉ Dividends Answer: The sum of money paid to shareholders decided
by the board of directors of a company
◉ Gross profit Answer: = sales revenue - cost of sales
◉ Cost of sales Answer: = opening stock + purchases - closing stock
◉ Net profit before interest and tax Answer: = gross profit - expenses
◉ Net profit before tax Answer: = net profit before interest and tax -
interest
,◉ Net profit after interest and tax Answer: = net profit before tax -
corporate tax
◉ Retained profit Answer: = net profit after interest and tax - dividends
◉ Profit and loss account table Answer:
◉ Balance sheet Answer: Outlines the assets, liabilities, and equity of a
firm at a specific point in time
◉ Fixed assets Answer: Long-term assets that last a business more than
12 months
◉ Current assets Answer: Short-term assets that last in a business for up
to 12 months
◉ Long term liabilities Answer: Long term debts or borrowings payable
after 12 months by the business
◉ Current liabilities Answer: Short term debts that are payable by the
business within 12 months
◉ Working capital Answer: = total current assets - total current
liabilities
, ◉ Total assets less current liabilities Answer: = (total current assets +
total fixed assets) - total current liabilities
= fixed assets + working capital
◉ Net assets Answer: = (total assets less current liabilities) - long term
liabilities
◉ Equity Answer: = share capital + retained profit
= net assets
◉ Balance sheet table Answer:
◉ Intangible assets Answer: Fixed assets that lack physical substance
and are non-physical in nature
◉ Patents Answer: Provide inventors with the exclusive rights to
manufacture, use, sell or control their invention of a product
◉ Goodwill Answer: The value of positive or favorable attributes that
relate to a business
◉ Copyright laws Answer: Laws that provide creators with the
exclusive right the production and sale of their artistic and literary work
