1. What is the balance sheet equation and how does it relate to the balance sheet of a business? (Minimum 50 words)

2. You have been studying the most recent financial statements of Auckland International Airport Limited. The equity section of Auckland International Airport Limited contains two main accounts: share capital and retained earnings. Explain how these two accounts are different from each other. (Minimum 60 words)

3. From the scenario described below, indicate (giving your reasons) the most appropriate business form Connor and Ella likely to take sole trader, partnership or company.

Connor and Ella wish to start an internet business, marketing cosmetics. They are concerned about the legal issues (for example, their personal liabilities) for this business once they start trading. (Minimum 60 words)