Part A (5 marks) How can you tell if an item needs to go to the Balance sheet, Income statement or Cash Flow Statement? What are the questions that you will ask for the REAL accounts?

a) Balance sheet b) Income statement c) Cash flow statement

Part B (5 marks) I. What is the difference between Assets and Liabilities called? II. If this difference is positive ie Assets exceed liabilities, the entity is said to be.? III. When a municipality is able to pay for its debts and its liabilities as they fall due, this is called what? IV. In municipal terminology, what is the difference between Revenues and Expenses called?