Financial Concepts Quiz

Which one of the following is the best description of an asset?

• Present obligations of the business that will lead to a future outflow of economic benefits.

• Resources under the control of the business which will provide future economic benefits.

• Causes an increase in owner's equity.

• Causes a decrease in owner's equity.

Which one of the following is the best description of a liability?

• Present obligations of the business that will lead to a future outflow of economic benefits.

• Resources under the control of the business which will provide future economic benefits.

• Causes an increase in owner's equity.

• Causes a decrease in owner's equity.

Which one of the following is the best description of owner's equity?

• Future obligations of the business.

• Resources under the control of the business which will provide future economic benefits.

• Liabilities less assets.

• Assets less liabilities.

Revenue could be defined as ..

• Future obligations of the business.

• Resources under the control of the business which will provide future economic benefits.

• Transactions that cause an increase in owner's equity excluding capital contributions.

• Transactions that cause a decrease in owner's equity excluding drawings.

Expenses could be defined as …

• Future obligations of the business.

• Resources under the control of the business which will provide future economic benefits.

• Transactions that cause an increase in owner's equity excluding capital contributions.

• Transactions that cause a decrease in owner's equity excluding drawings.

The reporting period is best described as …

• Period of time over which assets are determined.

• Period of time over which profit is determined.

• Period of time over which liabilities are determined.

• 1/7/XX to 30/6/XX

Equities are best described as …

• Assets and liabilities.

• Assets less liabilities.

• Liabilities and owners equity.

• Assets less owner's equity.

In a Balance Sheet, the following ‘balance’ …

• Assets and liabilities.

• Assets and equities.

• Assets and revenues.

• Equities and liabilities.

Transactions are evidenced by …

• Cash Flow Statement.

• Income Statement.

• Source Documents.

• General Journal.

The 'Elements' are ...

• Assets, liabilities and owner's equity

• Revenue and expenses

• Assets, liabilities, owner's equity, revenue and expenses

• The Income Statement and Balance Sheet