Accounting equation and transactions Flashcards
1
Q
What is the accounting equation?
A
assets - liabilities = capital
2
Q
What is capital income?
A
-any income arising from sale of a NCA
eg. land, buildings and machinery
3
Q
What is capital expenditure?
A
-purchases of a NCA
eg. land and buidlings
4
Q
What is revenue income?
A
-income arising from the sale of goods or services
eg. sales, rental income and interest received
5
Q
What is revenue expenditure?
A
-the purchase of goods for re-sale and the day to day running expenses
eg. purchases and heat/light
