Explanation

Stock taking is a physical count and valuation of inventory at the end of the financial year.

It provides an accurate measure of closing stock, essential for preparing final accounts.

Explanation

Financial asset valuation is primarily based on the present value of expected future cash flows, such as interest or dividends.

This approach discounts future income to reflect its value in today's terms, helping investors assess true worth.

Explanation

A price floor sets a minimum price to support farmers’ incomes.

It prevents prices from falling below a certain level, helping stabilize agricultural markets.

Explanation

Explanation

Common equity includes common stock and retained earnings, representing shareholders’ ownership.

It reflects the residual interest in the assets after deducting liabilities.

Explanation

Net profit margin = Net profit ÷ Total revenue × 100.

It shows how efficiently a company converts revenue into actual profit.

Explanation

A trial balance is prepared by taking the balances from ledger accounts.

It helps check the arithmetic accuracy of bookkeeping entries.

Explanation

Cash account is an asset and all assets have a debit normal balance.

Therefore, it appears on the debit side of the trial balance.

Explanation

Cash equivalents are short-term, highly liquid investments easily convertible to cash.

They have minimal risk of value change and are recorded at book value.

Explanation

The P/E ratio compares a company’s stock price to its earnings per share (EPS).

A higher P/E often reflects greater investor expectations for future growth and profitability.