Components of a statement of financial position:

• The statement of financial position is also known as the balance sheet.
• What is the definition of liabilities in the statement of financial position?

  What the company owes
• The basic formula of the statement of financial position is Assets = Liabilities + Equity.


  True
• Assets are resources owned by the company that have economic value.
• What is an example of a non-current asset?

  Land
• What the company owns is referred to as assets
• The fundamental accounting equation is Assets = Liabilities + Equity.
• What are the two main categories of liabilities?

  Current and non-current
• Match the equity component with its definition:

  Retained Earnings ↔️ Profits the company has earned and retained

  Paid-in Capital ↔️ Money shareholders invested in the company
• What is the purpose of the statement of financial position?

  Summarize assets, liabilities, and equity
• Match the balance sheet heading with its description:

  Assets ↔️ Resources owned by the company

  Liabilities ↔️ Obligations the company owes to others
• What does equity represent in accounting terms?

  The owners' stake
• Non-current assets provide long-term value
• Non-current liabilities are debts due beyond one year
• Match the asset type with its definition:

  Current Assets ↔️ Assets converted into cash within one year

  Non-Current Assets ↔️ Assets that benefit the company for more than one year
• The three main components of the balance sheet are assets, liabilities, and equity.
• The fundamental accounting equation is Assets = Liabilities + Equity.


  True
• Current assets can be converted into cash within one year.


  True
• Debts due beyond one year are classified as non-current liabilities.
• What does the statement of financial position summarize at a specific point in time?

  Assets, liabilities, equity
• What is the definition of assets in the statement of financial position?

  What the company owns
• What is an example of a current asset?

  Cash
• What are the three main components of the balance sheet?

  Assets, Liabilities, Equity
• What is another name for the balance sheet?

  Statement of financial position
• What are examples of non-current assets?

  Land, buildings, machinery
• What are the two main components of equity?

  Retained earnings and paid-in capital
• What is the accounting equation?

  Assets = Liabilities + Equity
• What are examples of assets in the statement of financial position?

  Cash, inventory, property
• Liabilities are obligations the company owes to others.


  True
• What is a key characteristic of current assets?

  Converted into cash within one year
• What are examples of current liabilities?

  Accounts payable, short-term loans
• Retained earnings are profits that the company has earned and retained
• The fundamental accounting equation is: Assets = Liabilities + Equity
• Match the components of the accounting equation with their definitions:

  Assets ↔️ What the company owns

  Liabilities ↔️ What the company owes

  Equity ↔️ The owners' stake in the company
• The three major headings in the balance sheet are assets, liabilities, and equity.
• What are the two main categories of assets?

  Current and non-current
• The basic formula of the balance sheet is Assets = Liabilities + Equity.


  True
• What are examples of liabilities in a balance sheet?

  Loans, accounts payable, wages payable
• What are the two main categories of assets?

  Current and non-current
• Current liabilities are debts due within one year.


  True