Question 11 (1 point)

There is no way to create or increase an asset without doing which of the following at the same time?

Question 11 options:

1)	Increasing another asset, incurring a liability, or increasing owners equity.

2)	Reducing another asset, incurring a liability, or reducing owners equity.

3)	Reducing another asset, incurring a liability, or increasing owners equity.

4)	Reducing another asset, reducing a liability, or increasing owners equity.

Question 12 (1 point)

Which of the following statements is FALSE in relation to equity?

Question 12 options:

1)	Equity is defined as the residual interest in the assets of the entity after deducting its liabilities.

2)	The owners equity section of a sole trader will typically include share capital, retained earnings and reserves.

3)	A reserve is a component of equity and can be created in a variety of ways, including as a result of a revaluation of a non- current asset

4)	None of these choices.

Question 13 (1 point)

Which of the following scenarios would require an organisation to recognise an expense and recognise a liability called accounts payable? [Meaning that expense increases (equity decreases) and accounts payable (liability) increases.]

Question 13 options:

1)	The organisation has received the related service and the related invoice, and the organisation has paid the cash

2)	The organisation has received the related service and the related invoice, and the organisation has NOT paid the cash

3)	The organisation has NOT received the related service and the organisation has paid the cash

4)	The organisation has NOT received the related service and the organisation has NOT paid the cash

Question 14 (1 point)

Which of the following statements is FALSE in relation to the presentation of the income statement?

Question 14 options:

1)	The income statement can be presented in a variety of ways.

2)	It is important that the title of the income statement clearly indicates the length of the accounting period to which it relates.

3)	The income statement will show the financial position of an organisation at a particular point in time.

4)	The income statement shows the profit or loss of the organisation.

Question 15 (1 point)

A common and sensible cash control method is encouraging customers to pay by cash rather than electronic funds transfer (EFT).

Question 15 options:

	1) True
	2) False

Question 16 (1 point)

A liquidity crisis is characterised by a lack of positive cash flows within an organisation, and a situation where an organisation does not have sufficient liquid assets to meet obligations that need to be paid in the short run.

Question 16 options:

	1) True
	2) False

Question 17 (1 point)

Operating efficiency ratios provide insight into how efficiently an organisations managers are managing its assets and liabilities. Such ratios include inventory turnover, debtors turnover and operating cash flow margin.

Question 17 options:

	1) True
	2) False

Question 18 (1 point)

Return on assets and return on owners equity fall into which category of accounting ratios?

Question 18 options:

1)	Profitability ratios

2)	Operating efficiency ratios

3)	Liquidity ratios

4)	Investment-based ratios

Question 19 (1 point)

Which method of financial statement analysis involves looking at various financial indicators perhaps accounting ratios over a number of accounting periods to see if there is an apparent pattern of improvement or deterioration?

Question 19 options:

1)	Simple comparison

2)	Ratio analysis

3)	Trend analysis

4)	Comparison with benchmarks

Question 20 (1 point)

The debt to equity ratio and the debt to assets ratio fall into which category of accounting ratios?

Question 20 options:

1)	Financial gearing (or stability) ratios

2)	Profitability ratios

3)	Liquidity ratios

4)	Investment-based ratios