Financial Accounting Quiz

Financial Accounting is mainly concerned with:

• Internal decision making

• Recording and reporting financial transactions

• Tax planning

• Budgeting

Which of the following is a non-current asset?

• Inventory

• Cash

• Equipment

• Trade Receivable

Trade Receivables are:

• People the business owes money to

• People who owe money to the business

• The owners of the business

• The bank

The Accounting Equation is:

• Assets = Liabilities – Equity

• Assets + Liabilities = Capital

• Assets = Liabilities + Capital

• Assets – Liabilities = Profit

A Statement of Financial Position is also known as:

• Statement of Profit and Loss

• Balance Sheet

• Cash Flow Statement

• Income Statement

Liabilities are what the business owns.

• True

• False

Equity represents what the business owes to its owners.

• True

• False

The Statement of Financial Performance shows a company’s position at a single point in time.

• True

• False

A loan payable is a current liability if it must be paid within one year.

• True

• False

Financial accounting is primarily for external stakeholders.

• True

• False