Statement of financial postiton

Question 1

What is the purpose of a statement of a financial postition

Answer 1

Purpose
Achieved
To measure Assets, Liabilities and Equity at one point in time for the (insert name of the Business here).
Merit
This allows (insert the user name here) to make decisions about (make up a decision relating to Assets, Liabilities or Equity related to the question).

Question 2

What are the components of a statement of financial postition

Answer 2

Current Assets
Non Current Assets
Plant Property Equipment
Investments
Intangible 
Current Liabilities
Non Current Liabilities
Owners Equity

Question 3

What are the limitations of a statement of financial postition

Answer 3

Assets value are recorded at Historical Cost so market valuation may have changed and the asset maybe either under or over stated.

Accumulated Depreciation and Allowance for Doubtful Debts are based on estimates

Does not show non-financial information. E.g. the quality and age of assets, the ability of staff.