Mid-Term Exam

Which of the following is NOT a type of financial statement?

• Balance Sheet

• Income Statement

• Cash Flow Statement

• Budget Report

What is the primary purpose of the income statement?

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

• To report a company's revenues and expenses over a period of time

• To provide information about cash inflows and outflows

• To summarise changes in equity

Which equation represents the accounting equation?

• Assets = Liabilities + Equity

• Assets = Liabilities - Equity

• Assets + Liabilities = Equity

• Assets - Liabilities = Equity

Which of the following is a component of equity?

• Accounts Payable

• Retained Earnings

• Inventory

• Cash

Which form of business organisation is owned by shareholders?

• Sole Proprietorship

• Partnership

• Corporation

• Cooperative

• $40,000

• $60,000

• $100,000

• $160,000

Which financial statement provides information about a company's cash receipts and cash payments during an accounting period?

• Balance Sheet

• Income Statement

• Cash Flow Statement

• Statement of Changes in Equity

What is the main characteristic of a sole proprietorship?

• Owned by multiple individuals

• Limited liability

• Owned and operated by one individual

• Shares traded on a stock exchange

Which of the following is an example of a liability?

• Equipment

• Accounts Receivable

• Accounts Payable

• Retained Earnings

What does the balance sheet primarily show?

• A company's profitability over a period

• A company's financial position at a specific point in time

• A company's cash inflows and outflows

• A company's changes in equity