11 Accounting Week 2

Which of the following are assets? (You can select more than one answer)

Which of the following are assets? (You can select more than one answer)

Which of the following are liabilities? (You can select more than one answer)

Which of the following are liabilities? (You can select more than one answer)

Which of the following represent the accounting equation (you can select more than one answer)?

If M. Rode had the following assets and liabilities, what is the investment in the business?

Cash in hand $1000, Loan from bank $4000, Accounts payable $500, Accounts receivable $9500, Supplies $500, Furniture $3500

C. Black, a plumber, gives you the following list of items. Use the accounting equation to determine the total value of ASSETS.

Amount owing to Tim McLean $1000, Value of pipes held $8000, Loan from bank $1000, Amount owing by Charles Frey $1000, New equipment $3000, Vehicle $15000, C. Black's investment in the business (equity) $25000

Represent the following list of TOTAL assets and liabilities using the accounting equation.

Cash at bank $1000, Accounts receivable $500, Inventories $750, Equipment $3000, Accounts payable $250

The accounting equation only has meaning because of the accounting entity concept. This gives us the concept of owner's equity. Owner's equity exists because the owner is regarded as separate from the business. Given this, decide whether the following statement is TRUE or FALSE.

The business regards the owner as a special liability. (Refer page 32 if you need)

Read page 32, 'Detailed examination of the equation'. State whether the following could happen.

A < L + OE

Read page 32, 'Detailed examination of the equation'. State whether the following could happen.

A > L + OE