Ch 3 Accounting Equation

Assets are resources a business owns or controls that are expected to provide ___ benefits.

• present

• Past

• future

• indefinite

Which of the following is NOT an asset?

• motor vehicles

• cash at bank

• property

• Trade payables

Which of the following is a liability?

• trade receivables

• mortgage loan

• rent expense

• drawings

Income refers to amounts ___ through the activities of a business.

Income comprises revenue earned from selling goods or services and ___ income earned from other business activities.

Income earned from selling goods is called ___ revenue

Expenses are costs ___ in the operation of a business to earn income in the same accounting period.

• occurred

• incurred

• paid

• spent

Equity refers to the ___ by the owner(s) on the net assets of a business

Equity comprises capital, profit or loss and ___.

• liabilities

• assets

• loan

• drawings

There are ___ accounting elements.

• 4

• 5

• 6

• 7