Balance Sheet Flashcards
1
Q
What is a balance sheet?
A
- Snapshot of companies financial position at given point in time
- Reports companies assets, liabilities and ownership equity
2
Q
What is meant by assets and liabilities?
A
A - Van or land which is owned
L - A loan or debt
3
Q
What is a current asset?
A
Cash and other assets that are expected to be converted to cash within a year
4
Q
What is a fixed asset?
A
Assets purchased for long-term use and are not likely to be converted quickly into cash, such as land, buildings and equipment
5
Q
What is difference between debtors and creditors?
A
- Creditors - individual or business that has lent funds to a business and is owed money
- Debtor - individual or business who has borrowed funds from a business and so owes it money
