3.3a The Double Entry Model

Question 1

What is the accounting equation

Answer 1

Assets = capital + liability

Question 2

what’s the difference between a current asset and a non-current asset

Answer 2

Current assets are belongings you intend to turn into cash within a year whereas non-current assets are belongings you intend to keep for more than a year

Question 3

what is the difference between current liabilities and non-current liabilities

Answer 3

current liabilities are liabilities due within a year whereas non-current liabilities are due after a year

Question 4

what is capital expenditure

Answer 4

the money spent on non-current assets to improve them or making them available for use