Exam 5: Presentation of Financial Position and the Worksheet

Which of the following errors will not cause an imbalance in the worksheet?

An addition or subtraction error will cause the worksheet to be out of balance by half the amount of the transaction.

George Corporation had the following transactions during the month of August: What are total assets for George Corporation at the end of August?

Which statement below is true about a company's operating cycle?

Which of the following is not a characteristic of a worksheet?

To be classified as a current liability, a debt must be expected to be paid within the current accounting period or within the entity's operating cycle, whichever is the longer.

Which of the following would not explain the difference between current and non-current assets?

Two transactions are recorded incorrectly in a worksheet. The first error is a transaction of $1000 which is recorded twice on the assets side of the worksheet. The second error is a transaction of $500 recorded only on the assets side of the worksheet. What will be the difference between the assets side of the worksheet and the liabilities + owners' equity side of the worksheet?

A Ltd sold a car for $75 000 which it had recorded in its accounts at $60 000. The effect on A Ltd's accounts is: AssetsLiabilities Equity

Owners' equity is:

Double-entry bookkeeping is based on a rule known as:

The accountant for Tiny Tots has compiled the following information about the company and its accounts:

How many of the following would be found on the balance sheet: Unearned revenue, Non-current assets, Current liabilities, Equity, Accounts receivable, Owners' equity, Inventory, Wages expense, and Interest income.

Chocolate Heaven, Inc. had a balance of $200 000 in shareholders' equity at the end of last year (i.e. 31 December). During this year, the company recorded a net profit of $50 000, distributed dividends of $30 000, and borrowed $10 000. What was the company's shareholders' equity at the end of this year as at 31 December?

What is meant by the concept of duality? Illustrate your answer with respect to the following three transactions (events): $\bullet$ Entity paid wages for services provided in the preceding fortnight. $\bullet$ Entity issued shares for land. $\bullet$ Entity paid $30 000 cash for equipment to be used in the business

Xavier Plata operates a small manufacturing business, trading under the name of Plata Products. The following list of financial data relates to the business as at 30 June. Additional information Required

If assets increase, then, applying the principle of duality, we must increase liabilities, decrease another asset or increase owners' equity.

Whether an asset should be reported as current or non-current, depends on whether the asset is in the form of cash or will be realised or consumed within the ensuing operating cycle of the entity.

A piece of equipment purchased for resale within the entity's operating cycle would be classified as a current asset.

Current assets are always classified according to their nature and not their function.