Use the following table to answer the next question.

	Asset	Liability	Revenue	Expense
i	Prepaid insurance	Wages payable	Dividends received	Dividends Paid
ii	Equipment	Accounts payable	Sales	Rent
iii	Inventory	Bank loan	Purchases returns	Equipment
iv	Accounts receivable	Dividends payable	Discount received	Discount allowed

Identify which of the above items are correctly classified:

Select one:

a.

i, ii, iii, iv

b.

i, ii

c.

ii, iii

d.

i, iv

e.

ii, iv

2.

The future sacrifices of economic benefits that an entity is obliged to make to other entities as a result of past transactions or other past events, is the best definition of:

Select one:

a.

Assets

b.

Liabilities

c.

Income

d.

Expenses

e.

Equity