Chapter 3

Question 1

What are the elements of financial systems?

Answer 1

Assets , Liabilities , Equity , Income , Expenses

Question 2

What are assets?

Answer 2

resources that business own

Question 3

What are liabilities?

Answer 3

amounts owed by business

Question 4

What is Equity

Answer 4

owners claim on business

Question 5

What is income?

Answer 5

amounts earned through the activities of the business

Question 6

What is expenses?

Answer 6

costs spend to run the business to earn income

Question 7

What is the account and nature of Furnitures?

Answer 7

Fixture & Fittings , Asset

Question 8

What is the nature of trade payables?

Answer 8

Liabilities

Question 9

what is the nature of drawings?

Answer 9

Equity

Question 10

What is the nature of Interest Expense?

Answer 10

Expenses

Question 11

What is the account and nature of sold goods

Answer 11

Sales revenue , Income

Question 12

what is the nature of investments made by the owner

Answer 12

Equity

Question 13

What is the nature of bank overdraft?

Answer 13

Liabilities

Question 14

What is the nature and account of payment with cash

Answer 14

Cash in hand , Asset

Question 15

What is the nature and accounting of goods

Answer 15

Inventory , Asset

Question 16

What is the account and nature of Cars

Answer 16

Motor vehicles , Asset

Question 17

What is the nature of trade receivables?

Answer 17

Asset

Question 18

What is the account and nature of buildings

Answer 18

Property , Asset

Question 19

What is the account and nature of computers

Answer 19

Office equipment, Asset

Question 20

What is the account and nature of money deposited with the bank?

Answer 20

Cash at bank , Asset

Question 21

an example of trade payables

Answer 21

rents expenses owing

Question 22

what is trade payables

Answer 22

borrowing money on credit or purchasing goods/ services on credit