Understand Accounting and Finance

What is Accounting?

• 1. a. Method of reporting financial activity of a business.

• b. Anything of value owned by the business.

• c. A statement of change in owner's equity.

• d. Buying and selling stock and other securities.

What is assets?

• a. Financial statement of a business that reports the changes that have occurred.

• b. Examining financial records for accuracy and compliance with regulations.

• c. Anything of value owned by the business.

• d. Financial transactions recorded in an orderly fashion.

Net worth of the business refers to which of the following?

• a. Liabilities

• b. Loss

• c. Revenue

• d. Owner's equity

Assets= Liabilities + Owner's Equity

• a. Accounting equation

• b. Payroll record

• c. Budget

• c. Finances

Money owed by the business (debts, accounts payable)

• a. Revenue

• b. Assets

• c. Liabilities

• d. Owner's equity

What is a balance sheet?

• a. Reports assets, liabilities, and owner's equity on a certain date.

• b. Costs of maintaining and operating a business.

• c. Specific period of time covered by an accounting statement or report.

• d. Results when a business's expenses are greater than its income.

What is expenses?

• a. Costs of maintaining and operating a business.

• b. Results when a business's expenses are greater than its income.

• c. Money owed by the business.

• d. The principle that a company's asses are equal to the sum of its liabilities and equity.

What is a financial statement?

• a. Written reports that describe the financial health of a company.

• b. Financial statement of a business that will report the loss.

• c. A financial statement that balances its owner's equity.

• d. A financial statement that reports the income.

What is an Accountant?

• a. Top level professional who will help buy and sell stock securities.

• b. Top level professional who may have final responsibility for aspects of a business' financial activity.

• c. A professional who will analyze the budgets of your company.

• Professional who produces and examines financial records, prepares financial reports and tax returns.

What is a Financial Manager?

• a. Top level professional who may have final responsibility for aspects of a business' financial activity.

• b. Top Level professional who produces and examines financial reports and tax returns.

• c. Top Level professional who will give advice on selling insurance and analyzing the budget.

• d. Top Level professional who will create the accounting equation.