Elements of accounting

Question 1

define Assets

Answer 1

A present economic resource controlled by the entity as a result of past events. An economic resource is a right that has the potential to produce economic benefits.

Question 2

define Liabilities

Answer 2

A present obligation of the entity to transfer an economic resource as a result of past events.

Question 3

define Equity

Answer 3

The resudual interest in the assets of the entity after deducting all its liabilities.

Question 4

define Income

Answer 4

Increases in assets, or decreases in liabilities, that result in increases in equity, other that those relating to contributions from holders of equity claims.
(not revenue from selling shares)

Question 5

define Expenses

Answer 5

Decreases in assets, or increases in liabilities, that result in decreases in equity, other than those relating to distributions to holders of equity claims.
(not issue of dividends to shareholders)