Quiz 2

What are the five major types of accounts?

• assets, liabilities, equity, revenue, expenses
• assets, liabilities, equity, revenue, income
• income, expenses, equity, assets, liabilities
• assets, liabilities, equity, revenue, profit

What is the accounting equation?

• Assets = Liabilities + Equity

• Revenue = Expenses

• Income = Profit

• Liabilities = Equity

• Assets = Revenue + Expenses

What is the purpose of a balance sheet?

• To show the financial position of a company at a specific point in time

• To calculate the net income of a company

• To record daily transactions

• To analyze market trends

• To forecast future expenses

It is the basic storage account of information in accounting.

• balance sheet
• journal
• Account ledger

• Books

This is income that arises in the course of the ordinary activities of a business.

• Net income
• Gross income
• Revenue

• Non-operating income

Define the term 'equity' in accounting.

• The total assets of a company

• The total liabilities of a company

• The ownership interest in a company

• The revenue generated by a company

These are decreases in assets or increases in liabilities resulting in the decreases in equity, other than those relating to transactions with the business owner.

• Liabilities
• Revenues
• Assets
• Expenses

It is a list of accoun titles used in a business.

• Balance Sheet
• List of Assets
• Chart of Accounts
• Income Statement

It is the financial statement that presents the income and expenses, and consequently the profit or loss of a business.

• Income Statement
• Cash Flow Statement
• General Ledger
• Balance Sheet

It is the financial statement that presents assets, liabilities and equity of a business.

• Income Statement
• Cash Flow Statement
• Balance Sheet
• Trial Balance