2023年6月24日发(作者：)

Self Study

I. Choose the best answer for each question below.

1. Which of the following is not one of the features of the balance sheet?

A) Assets, liabilities and owners’ equity are three classified items of balance sheet.

B) The balance sheet can be prepared from the work sheet.

C) The balance sheet presents detailed and specific data that are enormous and difficult to

read.

D) The balance sheet can help lenders to make lending decisions.

2. Which of the following is NOT one of the basic financial statements?

A) Balance sheet.

B) Accounting work sheet.

C) Income statement.

D) Statement of cash flows.

3. Which of the following can be considered a current asset?

A) Inventory.

B) Equipment.

C) Land.

D) Franchise.

4. Intangible assets do NOT include ______.

A) copyrights

B) brand

C) goodwill

D) bonds

5. Current liabilities include the following except ______.

A) accrued liabilities

B) dividends payable

C) notes payable

D) prepaid expenses

6. Which of the following is the feature of liabilities?

A) Current liabilities and long-term liabilities constitute the two categories of liabilities.

B) Liabilities are not desirable because it means debts to the firm.

C) A firm must pay all its liabilities by the same deadline in the future.

D) A liability arises when a business liquidates a portion of its debts.

7. Which of the following descriptions is NOT right about owners’ equity?

A) Owners’ equity is the resources invested by the owner of the company.

B) Owners’ equity is always equal to the total assets plus the liabilities.

C) The owner of the company can claim his benefits after the creditors.

D) Owners’ equity is also called shareholders’ equity in a corporation.

8. Shareholders’ equity in a corporate form of ownership is ______.

A) solely composed of paid-in capital

B) solely composed of retained earnings

C) not any more complicated than owners’ equity in a partnership

D) more complicated than owners’ equity in a partnership 9. Which of the following descriptions about the balance sheet is NOT right?

A) The balance sheet can be arranged in the account form.

B) The balance sheet can be arranged in the report form.

C) The assets and the liabilities can be listed on the left-hand side and the owners’ equity

on the right-hand side.

D) The assets can be listed at the top and followed by the liabilities and owners’ equity.

10. Which of the following is a correct statement about the balance sheet?

A) In the balance sheet, assets are listed in the order of intangible assets, current assets and

long-term assets.

B) Notes receivable are always listed before accounts receivable, inventories, and cash.

C) Preferred stock, common stock and paid-in capital are usually listed before retained

earnings.

D) Liabilities are always listed before the owners’ equity.

II. Fill in the blanks with the proper words.

1. Cash includes bank deposits, currency, coin, checks, bank _______, and money _______, etc.

2. Accounts receivable are owed by a customer for sales of services or merchandise _______

and are _______ by customers to pay in the future.

3. When a sum of money is borrowed by the firm, a _______ is incurred.

4. Owners’ equity is a _______ claim because the claims of the ________ legally come first.

5. Decreases of the owners’ equity are caused in two ways: _______ of cash and _______ from

unprofitable operation.

6. A balance sheet sets forth two major parts in its format: ________ and ________ of the

statement.

7. If ABC Company has assets of $300,000 and owner’s equity of $50,000, its liabilities should

be ________.

III. True or False questions.

1. The balance sheet presents a flowing picture of the company’s financial position at a specific

time. ( )

2. Tangible assets have no physical existence, but they do have value that may bring the

business huge profits. ( )

3. A company that borrows money from an external party is called a creditor.( )

4. Long-term liabilities are obligations that a business does not expect to liquidate within the

normal operating cycle or one year. ( )

5. Retained earnings refers to the business’s cumulative net incomes. ( )

IV. Case

Task #1 Classify each account listed below into one of the following categories.

Task #2 Rearrange the account items in the order in which you would expect to find them in a

typical balance sheet and explain why you put them in that order.

Task #3 Prepare a balance sheet and determine the missing number.

Account items

a. cash $3,000 b. accounts payable $16,000 c. prepaid expenses

e. petty cash

g. accounts receivable

i. inventory

k. unemployment taxes payable

m. common stock

o. bonds payable

q. building

17,000 d. patents

200 f. land

80,000 h. externally acquired goodwill

85,000 j. wages payable

6500 l. retained earnings

20,000 n. interest payable

23,000 p. temporary investments

19,000

?

19,000

82,000

10,000

133,000

9,000

15,000

Categories

1. current assets

2. fixed assets

3. intangible assets

3. current liabilities

4. long-term liabilities

5. owners’ equity

V. Supplementary reading.

A balance sheet summarizes an organization or individual’s assets, equity and liabilities at a

specific point in time. Individuals and small businesses tend to have simple balance sheets. Larger

businesses tend to have more complex balance sheets, and these are presented in the

organization’s annual report. Large businesses also may prepare balance sheets for segments of

their businesses. A balance sheet is often presented alongside one for a different point in time

(typically the

previous year) for comparison.

Personal balance sheet

A personal balance sheet lists current assets such as cash in checking accounts and savings

accounts, long-term assets such as common stock and real estate, current liabilities such as loan

debt and mortgage debt due, or overdue, long-term liabilities such as mortgage and other loan debt.

Securities and real estate values are listed at market value rather than at historical cost or cost

basis. Personal net worth is the difference between an individual’s total assets and total liabilities.

US small business balance sheet

A small business balance sheet lists current assets such as cash, accounts receivable, and

inventory, fixed assets such as land, buildings, and equipment, intangible assets such as patents,

and liabilities such as accounts payable, accrued expenses, and long-term debt. Contingent

liabilities such as warranties are noted in the footnotes to the balance sheet. The small business’s

equity is the difference between total assets and total liabilities.

Notes

checking accounts 活期存款账户

savings accounts 储蓄存款账户

real estate 房地产

personal net worth 个人资本净值

contingent liabilities 临时负债

Keys

I. 1. C 2. B 3. A 4. D 5. D 6. A 7. B 8. D 9. C 10. D

II. 1. drafts, orders 2. on account, promises 3. liability 4. residual, creditors

5. withdrawals, losses 6. heading, body 7. $250,000

III. 1. F 2. F 3. F 4. T 5. F

IV.

Balance Sheet

ASSETS

Current Assets

Cash

Petty Cash

Temporary Investments

Accounts Receivable

Inventory

Prepaid Expenses

Total Current Assets

$ 3,000

200

15,000

80,000

LIABILITIES

Current Liabilities

Accounts Payable

Wages Payable

Interest Payable

Unemployment Taxes Payable

$ 16,000

10,000

9,000

7,000

$ 42,000

$ 81,000

$ 123,000

85,000 Total Current Liabilities

17,000

Long-term Liabilities

$ 200,200 Bonds Payable

$ 19,000

Total Liabilities

90,000

$ 109,000

Fixed Assets

Land

Building

Total Fixed Assets

Intangible Assets

Externally

Goodwill

Patents

Total Intangible Assets

Acquired

OWNERS’ EQUITY

$ 82,000 Common Stock

64,800 Retained Earnings

$ 200,000

133,000

$ 333,000 $ 146,800

Total Owners’ Equity

Total Assets

Total Liabilities

$ 456,000

Owners’ Equity

and

$ 456,000