Finance Unbox-ED (INR) - Grade 6-8 - Session 046 - Quiz 1

Select all the statements that are true about fixed assets

• Fixed assets have a useful life of more than one year
• Fixed assets are not purchased for resale
• Fixed assets are not used in the day-to-day operations of the business
• Fixed assets can be tangible assets or intangible assets

Except for land most tangible fixed assets lose value or depreciate over time due to wear and tear as we use them

• True
• False

Select the statement that is true

• Depreciation is the amount by which the value of a intangible fixed asset goes down
• Amortization is the amount by which the value of a tangible fixed asset goes down
• Both of the above
• None of the above

Both depreciation and amortization are an expense

• True
• False

Select the statement that is true

• Current assets are expected to be sold or converted into cash in less than one year
• Current assets are highly liquid assets which in finance means they can be easily sold or converted into cash
• Both of the above
• None of the above

Select all the examples of current assets

• Machines
• Receivables
• Inventories
• Payables

Current liabilities refers to all the payments that a business needs to make within the next one year

• True
• False

Select the correct formula for Working Capital

• Working Capital = Current Liabilities - Current Assets
• Working Capital = Current Assets - Current Liabilities
• Working Capital = Receivables - Inventories
• Working Capital = Receivables - Inventories - Payables

EBITDA is Earnings Before Interest, Taxes, Depreciation and Amortization

• True
• False

Select all the statements that are true

• Income statement shows how much money the business made i.e. Sales or Income
• Income statement shows how much money the business spent i.e. Expenses
• Income statement is important as it tells us if the business made a profit or had a loss
• All of the above