Practice English Vocabulary Exercises – Vocabulary for Banking and Finance: Balance sheets

A. Match the words from the balance sheet with the definitions.

The balance sheet above is simplified.

B. Write the words into the spaces.

arm          cash flow          founded          in its own right

liabilities          outstanding          pounds’ worth          sale or return

subsidiary          tied up          trading          went public

Parker Publishing was ¹…………………… in 1872 by Hieronymous Parker, originally as the publisher of a religious periodical called The Preacher. It now specialises in lifestyle magazines, and, through its ²…………………… Tekpress, also publishes several highly successful periodicals on consumer  nterest subjects such as computing and hi-fi. The distribution ³…………………… also distributes magazines from other publishers, and has become highly profitable ⁴……………………

The company ⁵…………………… in 1987. The shares, originally priced at 50p, are ⁶…………………… at the time of writing for around £3.20.

Like many magazine publishers, Parker are vulnerable to ⁷…………………… problems. As their magazines are on ⁸……………………, they usually have millions of pounds ⁹…………………… from retailers, and have ¹⁰…………………… of several million more in printers’ bills. In addition they have to keep large sums of money ¹¹…………………… in stock – the firm’s warehouses in London and Manchester usually contain around five million ¹²…………………… of magazines.

C. Look at the article above and the balance sheet on the opposite page. Answer the questions.

1   What are Parker Publishing’s main current liabilities?

     a   money owed to other companies (particularly printers).

     b   salaries and wages

2   The article doesn’t mention long-term liabilities. In the case of Parker Publishing are these more likely to be…?

     a   money that must be paid to printers in the distant future.

     b   repayments on a bank loans used to buy a fleet of lorries and the warehouse in Manchester.

3   The company’s share capital is £20m. Does this mean that…?

     a   their shares are currently worth a total of £20m

     b   the shares were worth £20m when issued, but are now worth much more

4   What’s the company currently worth?

     a   £20,000,000

     b   £98,000,000

     c   £118,000,000