Equity and Balance Sheet Quiz

What is the primary purpose of the Statement of Owner's Equity?

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

• To show the changes in the owner's equity over a period of time

• To show the cash inflows and outflows of a company

• To show the revenue and expenses of a company

Which of the following is NOT typically included in the Statement of Owner's Equity?

• Net income

• Owner's withdrawals

• Assets

• Additional investments by the owner

In the Balance Sheet, which equation represents the fundamental accounting equation?

Which of the following is classified as a current asset on the Balance Sheet?

• Land

• Accounts Receivable

• Equipment

• Building

What does the Balance Sheet primarily show?

• The profitability of a company over a period of time

• The financial position of a company at a specific point in time

• The cash inflows and outflows of a company

• The changes in owner's equity over a period of time

Which of the following is an example of a liability on the Balance Sheet?

• Cash

• Accounts Payable

• Owner's Capital

• Inventory

• $300,000

• $700,000

• $200,000

• $500,000

Which of the following transactions would increase owner's equity?

• Owner's withdrawal

• Net loss

• Additional investment by the owner

• Payment of liabilities

In the Statement of Owner's Equity, how is net income typically treated?

• It is subtracted from the owner's equity

• It is added to the owner's equity

• It is not included in the statement

• It is treated as a liability

Which of the following best describes the term "current liabilities"?

• Liabilities that are due within one year

• Liabilities that are due after one year

• Liabilities that are not due

• Liabilities that are due within five years