Английский язык = English. Учебное пособие-1

Exercise 5. Divide the text into logically complete parts and give a heading to each of them.

Exercise 6. Retell the text “Gains and Losses”.

III. Read Text C. Be ready to give the information about net income or net loss.

TEXT C

Net Income or Net Loss

Net income or net loss refers to the change in equity (i.e., the change in net assets) of an entity during the period as a result of transactions and other economic events that result in revenues, expenses, gains, and losses. Thus, net income or net loss includes all changes in equity during a period, except for investments by and distributions to owners, and certain other changes in net assets (such as changes in market values of investments in non-current marketable equity securities). Mathematically, net income or net loss is determined by revenues, expenses, gains, and losses as follows:

Net income or net loss = Revenues – Expenses + Gains – Losses [15, p. 40].

Notes:

net income – чистый доход net loss – чистый убыток

market values of investments – рыночная стоимость инвестиций non-current marketable equity securities – необоротные рыночные цен-

ные бумаги

Exercise 1. Give a summary on the topic “The Elements of Financial

Statements” using all the texts of Units 3 and 4.

IV. Translate Text D in writing. Make use of an economic dictionary. Pay attention to economic terms.

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TEXT D

Net Income

Net income under direct costing is not affected by changes in production. Net income is affected only by changes in the number of units sold.

Net income under absorption costing tends to be affected by changes in production, increasing as production increases, and vice-versa.

This is a major criticism of absorption costing, since an organization can thus increase its reported net income by simply increasing production.

When companies employ JIT* inventory methods, problems with net income under absorption costing are either eliminated or reduced to insignificant proportions.

The reason is that the erratic movement of net income under absorption costing, and the differences in net income between absorption and direct costing, arise because of changing levels of inventory. Under JIT, goods are produced strictly to customers’ orders, so inventories are either eliminated or held constant from period to period.

With no changes in inventories, there is no opportunity for fixed overhead costs to be shifted between periods under absorption costing. Thus, net income will be the same between direct and absorption costing, and the erratic movement in net income under absorption costing will be eliminated [15, p. 11].

* JIT – just-in-time

KEY TERMS EXERCISES

Exercise 1. Match the words on the left with the definitions on the right.

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ORAL SPEECH SECTION

Exercise 1. Read dialogue and decide whether a direct instrument in

Primrose is preferable.

Illustrative dialogue

A:Well, I must get back to our bankers with a concrete proposal within the next ten days. What do you suggest?

B:I’ll talk to the Group Financial Director. Logically we have only three options – one is a parent company guarantee or a cross guarantee from another European subsidiary with assets free, as collateral – and that’s complicated enough! Failing that, we could raise either a direct sterling or Eurodollar loan. Lastly, we could make a direct investment in Primrose.

A:Obviously, the last would be preferable, especially since we are planning this major expansion in Central and Eastern Europe.

B:I agree. But that depends on whether the Main Board approves your expansion project. Look, we ought to try to persuade your bankers not to insist on a guarantee, at least until a decision is reached on the Primrose project.

A:Yes, I agree entirely. It does occur to me that, if the Group Financial Director could come to Primrose and have a meeting with our bankers, he might convince them that Birmingham might support you. Or could he not invite them to Birmingham to see the main Primrose factory? Then they might accept a Letter of Credit or postpone the deadline for a guarantee.

B:It’s certainly worth a try. Let me talk to the chief and I’ll fax you an answer within 48 hours... [19, p. 112].

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Exercise 2. Give short negative answers to these statements.

Model: I must get back to our bankers with a concrete proposal. –No, you must not.

1.Mr. Smith will talk to the Group Financial Director.

2.We have only three options.

3.We could raise either a direct sterling or Eurodollar loan.

4.Primrose Group is planning this major expansion in Central and Eastern Europe.

5.The Main Board approved your expansion project.

Exercise 3. Complete the sentences about the illustrative dialogue with question words and give short answers to these questions.

Model: …must I get back to our bankers with a concrete proposal? –When must I get back…? –Within the next ten days.

1.…options do we have?

2.… could we make in Primrose?

3.… are we planning this major expansion?

4.… does that depend on?

5.… should we try to persuade not to insist on guarantee?

Exercise 4. Explain the meaning of the following words. Make use of the words in brackets.

Model: компания (of, body, combined, common, for, persons, object, the, to be)

A company is the body of persons combined for common object.

1.Услуга (work, to meet, need, done, some, to be, it, general)

2.Товар (to be, that, to buy, desirable, people, a thing)

3.Стоимость (this, for, thing, paid, to be, price)

Exercise 5. Replace the words in italics by synonyms.

Model: We could make a direct investment in Primrose. We could directly invest in Primrose.

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1.The Group Financial Director could have a meeting with our bankers.

2.We could raise a direct sterling.

3.A direct investment would be preferable.

4.The Main Board approves your expansion project.

5.The Director might convince them that Birmingham might support your company.

Exercise 6. Ask questions using the information in the following sentences.

Model: The Director asked if they sent containerized goods.

–Do you send containerized goods?

1.The Manager asked what options Primrose has.

2.The Controller asked if Primrose is planning any expansion.

3.The Financial Director asked where Primrose is going to have new markets.

4.The partner asked if there are any problems with Primrose expansion project.

5.The manager asked what helps Primrose to postpone the deadline for a guarantee.

Exercise 7. Complete these sentences.

1.We could raise either…

2.But that depends on…

3.The Main Board approves…

4.They might accept…

5.We ought to try…

6.The first option is a parent…

7.As collateral we could make…

Exercise 8. Make up sentences and translate them into Russian.

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UNIT 5

THE ELEMENTS OF FINANCIAL

STATEMENTS

(PART III)

1.The Statement of Cash Flows.

2.Overview of the Statement of Cash Flows.

Grammar:

Degrees of Comparison of Adjectives and Adverbs. Complex

Sentences.

PHONETIC AND LEXICAL EXERCISES

Exercise 1. Read and pronounce the following words.

Exercise 2. Study the meanings of prefixes super-, inter-, under-.

Read and translate the following words.

Interact, underproductivity, superstructure, interbank, intercorporate, underpopulation, superdividend, superprofit, interdepartmental, superefficiency, underproduce, undertime, supernormal, underweight, underestimate, superpower, undertake, interconnection, understaffed, supertax, underwork, underwriter, understanding.

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Exercise 3. Determine the part of speech of the following words, translate them.

Exercise 4. Make the “word tree” as in Exercise 3 with as many words as you can. Make use of the suffixes you know. Choose the initial word from Text A.

Exercise 5. Add prefix un- to the following words and translate them into Russian:

Equal, familiar, known, important, happy, available, employment, favourable, satisfactory.

Exercise 6. Explain the meanings of suffixes -ful and -less. Translate the given words.

Useful – useless, cashless, doubtful, speakless, meaningful, careful, homeless, hopefully.

Exercise 7. Read the words of the active vocabulary.

1)accrual – накопление

2)accrual accounting – метод начислений при учете доходов и издержек на счетах

3)acquire – приобретать

4)activities – деятельность

5)approach – подход

6)cause – вызывать, быть причиной

7)correlate – соотносить

8)cost allocation – распределение прямых затрат

9)depreciation expense – начисленный амортизационный износ

10)flexibility – эластичность

11)generate – производить

12)income statement – отчет о прибылях и убытках

13)lessee – арендатор

14)liquidity – ликвидность

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15)solvency – платежеспособность

16)to evaluate performance – оценивать деятельность

Exercise 8. Insert the words from the box to make sense.

Сorrelate, to evaluate, accrual, generates, caused, income statement depreciation, performance, cash flows.

1.Research workers found it hard to ... the two sets of figures.

2.When analysing financial statements managers try ...

a company’s ... as a whole.

3.If a company records its sales on an ... basis, the company puts the revenue on its books as soon as the deal is made.

4.What ... this company’s bankruptcy?

5.The statement of ... summarizes receipts and disbursals of cash in three areas: operations, investments and financing.

6.This method of recording revenue usually ... tax obligations before the cash has been collected.

7.The main components of the ... ... are revenues, expenses, and net income and loss.

8.The ... charge may be 30 % on the cost in 2007, leaving a reduced balance of US $7,000.

Exercise 9. Find the meanings of the following linking words with a dictionary.

Instead, while, furthermore, other, whereas, because, however, although, through, though, as well as, also, during, both ... and.

Exercise 10. Arrange the equivalents from the two columns.

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GRAMMAR EXERCISES

Exercise 1. Make degrees of comparison of adjectives and adverbs.

Model: big – bigger – the biggest;

important – more important – the most important.

Successful, wide, significant, large, active, profitable, broad, high, modern, huge, much, good, little, bad, substantial, many, well, comparable.

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