PRACTICE

What does a balance sheet show?

• a) Only the assets of the company.

• b) The assets, liabilities and equity of the company.

• c) Only the company's debts

What is meant by liabilities on a balance sheet?

• a) Everything that the company owns.
  

• b) The debts and obligations of the company.

• c) The net value of the company.

What is included in the assets of a company?

• a) Cash only.

• b) Debts and obligations.

• c) Products, land and computers.

What part of the balance sheet represents the net worth that belongs to the owners after all debts are paid?

• a) Heritage.

• b) Liabilities.

• c) Assets.

What does equity represent on a balance sheet?

• a) The company's debts.

• b) The total assets of the company.

• c) The net worth that belongs to the owners after paying all debts.