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Finance 101 - Balance Sheet

Total questions: 10

Worksheet time: 5mins

Name
Class
Date
1.

This means anything that provides or will provide a benefit.

a)

Net Income

b)

Equity

c)

Liability

d)

Asset

2.

Which of the following may NOT provide cash inflow to the company?

a)

Payment of liabilities

b)

Collection from customers

c)

Sale of company car

d)

Payment by employee of his loan

3.

In manufacturing, the transfer of work in progress to finished goods affects what balance sheet account:

a)

Inventories

b)

Cost of Goods Sold

c)

Production Machineries and Equipment

d)

Transfer Price

4.

The fixed assets of a company can be easily converted to immediate cash.

a)

True

b)

False

5.

This means an obligation that will require an entity to spend resources.

a)

Asset

b)

Liability

c)

Equity

d)

Net Income

6.

NMT sells CBUs to NPI on account, payable in 45 days. What is the effect on NMT's cash at the time of sale?

a)

Decrease

b)

Increase

c)

No effect

d)

Cannot be determined

7.

What is the effect of payment of NPI to NMT in the books of NMT?

a)

I. Increase in Cash

b)

II. Decrease in Liability

c)

III. Decrease in Accounts Receivable

d)

d) Both I & III

8.

Which of the following is a category, classification, or element of the balance sheet?

a)

Expenses

b)

Gains

c)

Equity

d)

Losses

9.

Equity is equivalent to the total assets of a company less its liabilities. It is also referred to as:

a)

Net Revenue

b)

Net Income

c)

Net Assets

d)

Net Liabilities

10.

Assets = Liabilities + Shareholders' Equity

a)

True

b)

False