Chapter 2 Exercises E2.1 The Statement of Financial Position shows assets, liabilities, and owners' equity a) as of a specific date. b) for a period of time. c) as of a specific date or for a period of time depending on the needs of users of the financial statements. d) none of the above. E2.2 The Income Statement shows revenues and expenses a) as of a specific date. b) for a period of time. c) as of a specific date or for a period of time depending on the needs of users of the financial statements. d) none of the above. E2.3 Which of the following is not a current asset? a) prepaid insurance, b) accounts receivable, c) inventory d) equipment E2.4 The equity section of a business's Statement of Financial Position includes the following: Capital stock... $1,000,000 Retained earnings . $4,000,000 This business is a a) partnership b) sole proprietorship. c) corporation d) cannot be determined based on information, E2.5 A disadvantage of the general partnership business form is that a) it results in double taxation of owners. b) its owners are subject to unlimited liability c) both a and b. d) neither a norb