Unit 1: Ch 2 - The Accounting Equation

Question 1

If a firm has assets of $125,000 and liabilities of $75,000, what is the worth of OE?

Accepted Answer

$50,000

Question 2

What was the second highest grossing movie of 2015?

Accepted Answer

Jurassic World

Question 3

Classification gives Balance Sheet greater ____________ for decision making.

Accepted Answer

Relevance

Question 4

What is the two-fold effect on the BS if stock is purchased on credit for $1,000?

Accepted Answer

⇧ Stock $1,000, ⇧ Creditors $1,000

Question 5

Classified BS clearly identifies the firm's_________assets, as well as the short-term_________.

Accepted Answer

....liquid....obligations.

Question 6

The Working Capital Ratio is:

Accepted Answer

Current Assets / Current Liabilities

Question 7

The current liability of a $20,000 loan paid in $1300 quarterly installments.

Accepted Answer

$5200

Question 8

Which of the following is NOT an item under Liabilities?

Accepted Answer

Debtors

Question 9

Which of the following is NOT a non-current asset?

Accepted Answer

Stock

Question 10

The residual interest in the assets of the entity after deduction of its liabilities

Accepted Answer

Owner's Equity

Question 11

Resources controlled by an entity that have future economic benefits as a result of past events

Accepted Answer

Assets

Question 12

Obligations which are expected to be met in the next 12 months.

Accepted Answer

Current Liabilities

Question 13

Which of the following is NOT the correct equation?

Accepted Answer

OE = A + L

Questions 13