Ch3

Question 1

Assets

Answer 1

Assets are resources a business owns or controls that are expected to provide future businesses

Question 2

Computer

Answer 2

Office equipment

Question 3

Furniture

Answer 3

Fixtures and fittings

Question 4

Lorries, vans

Answer 4

motor vehicles

Question 5

Goods bought for resale

Answer 5

Inventory

Question 6

Trade receivables

Answer 6

Customers owe to business

Question 7

cash at bank

Answer 7

Amount deposit into bank

Question 8

Paid by cheque

Answer 8

Cash at bank

Question 9

Liabilities

Answer 9

Liabilities are obligations owed by a business to others that are expected to be settled in the future

Trade payables : business buys on credit to suppliers
Bank overdraft: owe $ to bank when bank account Is overdrawn

Question 10

Equity

Answer 10

Amount of capital contributed to business and profit earned - drawings

Question 11

Income

Answer 11

Amount earned thru activities of business
Income revenue : earned thru main activity of business
other income : earned through other activities

Question 12

Expenses

Answer 12

Costs incurred in the operation of business to earn income
- salaries
- rental
- interest on loan
- advertising
- cost of sales
- utilities
Repair and maintenance