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The ability of a business to pay its debts is called a. a fiscal year. O b. solvency. O c. liquidity. O d. currency.
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- What is the effect on the accounting equation when a business pays the balance due on accounts payable?The ability of a business to pay its debts as they come due and to earn a reasonable net income is a. solvency and equity b. solvency and profitability c. solvency and leverage d. solvency and liquidityA. accrued income F. cash G. owner's equity H. intangible assets I. liability J. chart of accounts B. non- current asset C. notes receivable D. income E. rent expense 1. It is the debt of the company payable in money, goods, or services. 2. It is the list of all accounts of the company that is being used by the firm to their financial records. 3. These are non-monetary assets but identifiable although without physical substance. 4. It is the claim of the owner on the business. 5. It is the most liquid asset which can be given and taken easily. 6. It is an expense for lease like office space, building space, and land. 7. Examples of this are service revenue and sales. 8. It is a written note from the customer to pay his account on a given time and date. 9. Property Plant and Equipment (PPE), land, and buildings are examples of these. 10. This account title is a revenue earned but not yet collected.
- The relationship between current assets and current liabilities is a. useful in determining profitability. b. useful in evaluating a company’s liquidity. c. useful in evaluating a company’s solvency. d. useful in determining the amount of a company’s non-current debt.Which of the following increase when business takes a loan from a bank? O a. Sales O b. Equity O C. Liability O d. RevenueWhat is total assets on this company's balance sheet? What is total current liabilities on this company's balance sheet? What is the correct order for the current liabilities section of the balance sheet? a. Accounts payable, payments to suppliers, deferred revenue, income tax payable b. Bank loan payable, Income tax payable, Accounts payable, Deferred revenue c. Accounts payable, Income tax payable, Payments to suppliers d. Accounts payable, Deferred revenue, Income tax payable e. Accounts payable, Income tax payable Enter the letter that corresponds to your choice. (A B C D E) What is total liabilities on this company's balance sheet? What is total equity on this company's balance sheet? What is the correct order for the equity section of the balance sheet? a. Owners' Capital, Retained earnings b. Retained earnings, Owners' capital c. Retained earnings, Owners' capital, Profit d. Retained earnings, Profit, Owners' capital e.…
- Which of the following liabilities is created when a company receives cash for services to be provided in the future? A. Unearned Revenue B. Estimated Warranty Payable C. Accrued Liability D. Accounts PayableA primary focus of financial reporting about a company's performance during an accounting period is information related to the company's: a. Balance Sheet b. Income Statement c. Comprehensive Income d. Cash FlowsWhich of the following increases the current assets of a business entity? A) Consumable inventory B) Bank (credit balance) C) Investment (with a maturity date of more than one year hance) D) Deferred income
- 46) Accounts receivable is ______________ of an organization. a. Current assets b. Current liabilities c. Non-current assets d. Non-current liabilities* A financial document that indicates the success or failure of a business trading over a period of time is called An income statement O Retained earnings statement O A cash flow statement A bank statements OExplain whether each of the following balance sheet items increases, reduces, or has no directeffect on a company’s ability to pay its obligations as they come due. Explain your reasoning.a. Cash.b. Accounts Payable.c. Accounts Receivable.d. Capital Stock.