1. A balance sheet always shows an entity's assets, liabilities and equity: (a) at a point in time. (b) over the relevant trading period. (c) at market value. (d) once per year. 2. The acquisition (or sale) of assets is referred to as an: (a) off-balance-sheet financing transaction. (b) internal financing decision. (c) intangible asset. (d) investment decision. 3. Assets with limited lives: (a) are required to be depreciated. (b) are not included in the balance sheet. (c) should not be accounted for in the current period. (d) are shown on the income statement. 4. How would a large entity normally classify a trade creditor? (a) An intangible asset (b) A receivable (c) A payable (d) An inventory item 5. How would a large entity normally classify an employee's long-service leave liability? (a) A reserve (b) A retained liability (c) A provision (d) None of the above. 6. How are liabilities of an entity referred to? (a) External claims on the entity's assets (b) Internal claims on the entity's assets (c) What the entity owns on a particular date (d) What the entity has owing to it on a particular date. 7. What is an example of a working capital asset? (a) Cash at bank (b) Accounts receivable (c) Plant and equipment (d) (a) and (b) only 8. What does the liquidity of an entity refer to? (a) How economically stable the business is