Topic 2 Accounting For Transactions - Financial Reporting

Question 1

What is cash affected by?

Answer 1

1. Item being paid
2. Money coming out the account

Question 2

What is profit affected by?

Answer 2

1. Making a sale
2. Money coming in or out the bank acc

Question 3

What is the accounting equation?

Answer 3

Assets = liabilities + equity

Question 4

What is the difference in the left and right side of the equation?

Answer 4

Left is what we own, right is what we owe

Question 5

Difference between liabilities and equity

Answer 5

Equity is owed to shareholders liabilities are owed to creditors