QUIZZ – FOUR MAIN FINANCIAL STATEMENTS

What does a balance sheet show?

• How much profit a company earned during a year

• A company’s assets, liabilities, and shareholders’ equity at a specific point in time

• A company’s inflow and outflow of cash

• Changes in equity during a period

Which of the following is a current asset?

• Equipment

• Buildings

• Accounts receivable

• Patents

Which of the following is a non-current liability?

• Accounts payable

• Bank loan due in 6 months

• Rent payable

• 5-year bank loan

Which of the following equations is correct?

• Assets = Liabilities – Equity

• Assets + Liabilities = Equity

• Assets = Liabilities + Shareholders’ Equity

• Assets = Equity – Liabilities

Shareholders’ equity represents:

• the residual interest in the assets of the company after deducting liabilities

• the total assets owned by shareholders

• the total liabilities of the company

• the amount of cash held by the company

Another name for the Income Statement is:

• Statement of Assets

• Profit and Loss Statement

• Statement of Cash Flow

• Statement of Retained Earnings

What does “Gross Revenue” mean?

• Revenue after deductions

• Revenue before deductions

• Net profit after tax

• Total operating expenses

Formula for Net Revenue is:

• Gross Revenue + Returns & Allowances

• Gross Revenue × Returns

• Gross Revenue – Returns & Allowances

• Gross Revenue ÷ Returns

Gross Profit (Gross Margin) equals:

• Net Revenue – COGS

• Net Revenue + COGS

• COGS – Net Revenue

• Operating Profit – COGS

Which of the following is not an operating expense?

• Salaries of admin staff

• Marketing cost

• Research and development (R&D)

• Purchase of machinery