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Hello sir,
I’m trying to get my head around all sort of terms appearing in statement of financial position for the Financial Performance Measurement chapter. It’s quite hard to completely understand but it seems like these three terms means the same thing?
Is that correct? Thanks.
The three terms do not mean the same thing, but they are all equal to each other.
This is dealt with in Paper FA (and fully explained in our free notes and lectures for Paper FA), but is not relevant for Paper MA.
Thanks for the reply, sir.
I see, then for MA exam, can I consider those three terms meaning the same thing? I’m asking this as some of the BPP questions treat those three terms as same, for example,
17.10 answer referred ROI = (Profit/capital employed) x 100%
whereas according to the OpeuTuition lecture, ROI = (Profit/*net assets*) x 100%I’ve encountered a few of these examples which confused me a lot, and came up with “Total long term capital = capital employed = net assets”, following BPP MA answers.
Would this be a problem if I apply this logic ONLY for the MA exam?
Thanks!
For Paper MA (and FM) is it OK to consider them as you have written 🙂
If you want a fuller understanding then do watch the lectures on the first couple of chapters of our Paper FA notes.
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