Chapter 3, Problem 7PSB

To determine

Current Assets:

Current assets are short term assets which are likely to be turn into cash within a year. For example, cash, accounts receivable, inventories and many more.

Long-term Investments:

Any investment that company makes with a view of keeping it for more than one year is called long-term investments.

Plant Assets:

Any assets whose useful life is more than one year and which is use to facilitate the production process is called plant assets.

Intangible Assets:

Intangible assets are those assets which do not have a physical nature but yet has value for the company. For example: Patent and goodwill.

Current Liabilities:

Any liability which needs to be paid within one year is called current liability.

Long-term Liabilities:

Any liability which is not due to be paid within one year is called long- term liability.

Equity:

It is shareholder’s fund. It is that part of the company's liabilities that are used to finance the operations of the business. They are the owner of the business.

To identify: To indicate correct letter against each balance sheet item.