The accounting equation:

Total assets are Rs.89, 000 and total liabilities are Rs.23,500. Calculate the value of owner’s equity.

• Rs.65,500

• Rs.1,12,500

• Rs.89,000

• Rs.23,500

Liabilities total Rs.11,200 and the owner’s equity is valued at Rs.47,500. Calculate the value of the business assets.

• Rs.36,300

• Rs.58,700

• Rs.11,200

• Rs.47,500

Use the following information to calculate the value of the owner’s equity: Equipment Rs.454, Inventory Rs.131, Cash Rs.654, Trade payables Rs.646.

• (a) Rs.1,239

• (b) Rs. 646

• (c )Rs.876

• (d) Rs.593

Which of the following is not a reason for buying shares in a limited company?

• (a) To receive dividends

• (b) To control the business

• (c )To profit from rising share prices

• (d) To obtain credit

Which of the following is an asset?

• A bank loan

• Mortgage

• Amount owing to suppliers

• Inventory bought on credit

Use of following data to calculate the value of the owner’s equity. Machinery Rs.54,000, Equipment Rs.8,200, Bank balance Rs.1,150, Bank loan Rs.15,900

• Rs.47,450

• RS.62,450

• Rs.78,450

• Rs.63,350

Which of the following is NOT a likely reason why profit is important to the owner of a business?

• To inform competitors

• To keep shareholders happy share

• To calculate the right amount of tax to be paid

• So that borrowing is possible

Which of the following is not a liability?

• Trade credit given by suppliers

• Bank loan

• Trade credit given to customers

• Mortgage on property

Which of the following is not true?

• Assets = Liabilities + Owner’s equity

• Assets = Liabilities – Owner’s equity

• Owner’s equity = Assets – Liabilities

• Liabilities = Assets – Owner’s equity