CHAPTER 2: Financial Statements

Which of the following are Financial Statements for business?

• Trial Balance Account

• Ledger

• Income Statement

• Balance Sheet

Which of the following included in Income Statement?

• Sales

• Assets

• Taxes

• Rental cost

• Liability

Which of the following included in the Balance Sheet?

• Sales

• Assets

• Taxes

• Rental cost

• Liability

The income statement consists of Operating Activities, Financing Activities, and Investment activities.

• True

• False

Operating Activities in the Income Statement consist of the following:

• revenue

• cost of good sold

• operating expenses

• interest expense

• income taxes

Operating Income is also known as

• EBT

• EAT

• EBIT

• Revenue

Which of the following does not belong to current asset

• marketable securities

• machine and equipment

• inventory

• prepaid expenses

Which of the following are not Current Liabilities

• Account payable

• Mortgages

• Short-term notes

• Accrued expenses

Which of the following are Equity

• Preferred stock

• Mortgages

• Paid-in-Capital

• Retained earnings

• Short-term notes

Assets that are relatively liquid and are expected to be converted to cash within a year. - This refers to

• Equity

• Liability

• Current asset

• Fixed asset