Balance Sheet - Financial Statement

What are long-term investments primarily invested in?

• Land and buildings

• Financial assets

• Equipment

• Short-term securities

Long-term investments are opposed to investments in which type of assets?

• Intangible assets

• Financial assets

• Real assets

• Liquid assets

What is the minimum maturity period for an investment to be considered long-term?

• Less than one year

• Greater than one year

• Exactly one year

• Greater than five years

What do property and equipment represent in accounting terms?

• Current assets

• Intangible assets

• Fixed assets

• Variable assets

How are fixed assets initially reported on the balance sheet?

• At their net cost

• At their depreciated cost

• At their original (gross) cost

• At their market value

What is subtracted from the historical cost of net fixed assets to determine their value on the balance sheet?

• Market depreciation

• Accumulated depreciation

• Annual depreciation expense

• Investment cost

How is the accumulated depreciation account affected each year?

• It is decreased by the amount of depreciation reported on the income statement.

• It remains unchanged.

• It is increased by the amount of depreciation reported on the income statement.

• It is reset to zero.

What happens to net fixed assets each year?

• They are revalued at market price.

• They are increased by the annual depreciation expense.

• They are reduced each year by the annual depreciation expense.

• They remain constant.

What are current liabilities?

• Long-term financial obligations

• Payment obligations that come due within three years

• Payment obligations that come due within one year

• Investments that must be liquidated within one year

Which of the following is NOT a common current liability?

• Notes payable

• Accounts payable

• Accrued expenses

• Deferred revenue