Principle of Accounts

Which one is right?

• Asset = Owner's equity + Liability

• Asset = Owner's equity - Liability

• Asset + Owner's equity = Liability

• Asset + Owner's equity = expense

Property owned by an individual

• Liability

• Asset

• Property

• Net Worth

Examples of Liabilities include which of the following:

• Loans, credit cards, and real property

• Loans, mortgage, and credit cards

• Loans, Art collection, and savings account

• Mortgage, credit card, and real property

Examples of assets include:

• Real Property, Car, and credit cards

• Car, Jewelry, and Checking account

• Art collection, Jewelry, and unpaid taxes

• Real Property, Car loan, Jewelry

Which of the following is considered an asset?

• Bank Loan
• Mortgage
• Debit Card
• Savings account

Which of the following is considered a liability?

• Savings Account
• Mortgage
• Savings bond
• Coin Collection

Current Assets are cash or other assets that are expected to be converted to cash within a year

• True

• False

Non current liability are financial obligations that are due for settlement within 1 year. True or False

• True

• False

Which of the following is not categorised as Current Asset in a Balance Sheet?

• Inventories

• Bank Balances

• Plants and Machinery

• Trade Debtors

Which of the following equation is true?

• Total Asset = Current Asset + Current Liabilities

• Asset = Liabilities + Stakeholder's Equity

• Total Liabilities = Current Liabilities + Non Curent Liabilities + Equity

• Equity = Current Liabilities + Non Current Liabilities