I used my house, which I fully paid, as collateral to take out a loan to borrow money from a bank. In this transaction, a financial asset was destroyed O a real asset was created O a new financial asset was created a financial asset was traded for a real asset
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- To purchase an asset such as office equipment on account, you would credit which account? (a) Cash (c) Accounts Payable (b) Accounts Receivable (d) CapitalQUESTION 8 Classify the following items into assets, liabilities, or owner’s equity. a. Office equipment ______ b. Freehold premises _______ c. Capital _________ d. Mortgage on buildings____ e. Debtors _____ f. Short-term loan _________ g. Long-term loan ________ h. Drawings _________ i. Bank ____________ j. Bank overdraft ________ k. Creditors __________ l. Net profit _____Capital Select one: a. The money invested in a business b. The ending or relaxing of legal restrictions c. Money placed in a bank d. A sum of money borrowed in a bank
- 1. What is the time value of money? Why should accountants have an understanding of compound interest, annuities, and present value concepts? 2. Identify three situations in which accounting measures are based on present values. Do these present value applications involve single sums or annuities, or both single sums and annuities? Explain. 3. What is the nature of interest? Distinguish between “simple interest” and “compound interest.” 4. Jose Oliva is considering two investment options for a $1,500 gift he received for graduation. Both investments have 8% annual interest rates. One offers quarterly compounding; the other compounds on a semiannual basis. Which investment should he choose? Why?Q4 Which of the following statements is NOT correct? (i) For an asset to be classified as a financial asset, cash or a right to receive cash or another financial asset should exist (ii) Cash constitutes a financial asset on its own. (iii) Any asset that can be interchanged for cash or cash equivalent should be classified as a financial asset even if there is no contractual right to receive cash or another financial asset. (iv) There is need for there to be a written and signed contract between buyer of the financial asset and the seller. Select one or more: a. (iii) and (iv) only b. (i), (ii), (iii) and (iv) c. (ii) only d. (i), (ii) and (iii) only1. Property owned by an individual? A. Liability B. Asset C. Property D. Net Worth 2.Examples of Liabilities include which of the following: A. Loans, credit cards, and real property B. Loans, mortgage, and credit cards C. Loans, Art collection, and savings account D. Mortgage, credit card, and real property 3.Positive Net Worth is defined as: A. assets are less that liabilities B. liabilities are greater than assets C.assets are equal to liabilities D.assets are greater than liabilities
- 1.Read the statements below and answer the question - The earnings process should be completed entitling the bank to the right to receive - Obligations arises on the part of the customer to remit fixed or determinable obligations - Amount received is known and if not collected is collectable with reasonable certainty What do the above statement reflect? (A) Revenue recognition principles (B) Expenses recognition principles (C) Provision recognition (D) Debt recognition principles 2.An asset is anything that is capable of generating positive cash flows or other economic benefits in the future either by itself or in combination with other assets which the financial institution has acquired the right to as a result of past transactions or events. Although the capacity of the financial institution to control benefits is usually the result of legal rights, an item may nonetheless satisfy the definition of an asset even there is no legal control. Based on the above statement which of…1. What is the amount of net free assets? 2. What is the estimated loss n asset realization? 3. What is the estimated recovery for the partially secured creditors? 4. What is the estimated recovery percentage for the notes payable?1.what do you mean by Accountancy? 2. Classification of asset? 3.what do you mean by goodwill? 4.what is bad debt? 5.who is the creditor?
- Identify if it will Increase, Decrease or No effect. 1.What will happen to the company’s liquidity when some of its products are sold from inventory? 2.What happens to the owner’s assets when the company purchases equipment with its cash? 3.What happens to the owner’s assets when the company repays the bank that had lent?True or False 1. One of the company's sources of funds is its own accumulated earnings. 2. In a debt equity, there exists a debtor and creditor relationship. 3. Supplier's credit as a source of fund is advantageous both to the debtor and the creditor. 4. One can open a deposit account with a lending institution. 5.QB) Choose the correct answer: 5. Temporary accounts would not include: Select one: a. Depreciation expense. b. Salaries payable. c. Cost of goods sold. d. Supplies expense. 6. Operating cash outflows would include: Select one: a. Purchases of inventory b. Purchase of equipment. c. Purchase of investments. d. Repayment of bank loan.