The Balance Sheet

What does a classified balance sheet show?

• Assets, liabilities, and owner’s equity (current and non-current)
  
  

• Total profit and losses for business

• Only money business owes

• Only owner's personal assets

Which of the following is a current asset?

• Building

• Inventory

• Term deposit paid back in 18 months

• Delivery van

Which of the following statement is INCORRECT?

• Asset - Owner's Equity = Liabilities

• Liabilities + Owner's Equity = Assets

• Assets - Liabilities = Owner's Equity

• Liabilities + Assets = Owner's Equity

Are all current/non-current assets listed on the LEFT or RIGHT hand side of the Balance Sheet?

• Left

• Right

Financial information must be capable of influencing decisions made by users to help them make predictions and/or confirm or change their previous evaluations.

• Period Assumption

• Faithful Representation

• Relevance

• Understandability