WorksheetsEquity and Owner's Equity Worksheet
Total questions: 10
Worksheet time: 5mins
Which of the following best defines equity?
The total assets owned by a business
The total liabilities owed by a business
The net amount of funds invested by owners after deducting liabilities from assets
The income generated by the business
The term “owner’s equity” is typically used for:
Companies only
Sole proprietorships and partnerships
Public limited companies
Government entities
What does the Statement of Changes in Equity show?
The movement of liabilities during a period
The movement of capital due to profits, losses, contributions, or withdrawals
The company’s assets and liabilities
The company’s cash inflows and outflows
Which of the following items decreases equity?
Profit earned
Additional capital contributed
Capital distributions or drawings
Issue of shares
In a partnership, profits and losses are:
Ignored in the statement of changes in equity
Shared among partners according to the agreed ratio
Transferred only to the managing partner
Added equally to all partners’ capital
Which item is not shown in the statement of changes in equity for a company?
Shares issued
Dividends paid
Drawings
Retained earnings
In a sole proprietorship, which items are included in the Statement of Changes in Equity?
Ordinary shares, retained earnings, and dividends
Beginning capital, additional capital, net profit or loss, and drawings
Preference shares, reserves, and dividends
Reserves, contributed equity, and other comprehensive income
In a company’s Statement of Changes in Equity, retained earnings are affected by:
Share capital issued and drawings
Profit for the year and dividends paid
Additional capital and withdrawals
Depreciation and prepaid expenses
Which of the following items is commonly presented in the Statement of Changes in Equity for a company but not for a partnership?
Profit for the year
Dividends paid
Additional capital
Drawings
10. The closing equity balances in the Statement of Changes in Equity must match:
the closing equity balances in the Statement of Financial Position
the opening balances in the next period
the total assets in the balance sheet
the net profit for the year
