C) The Purpose Of Accounting

Question 1

Capital income

Answer 1

The money invested by owners or investors to set up a business or buy additional equipment

Question 2

Revenue income

Answer 2

The money that comes into a business from performing its day-to-day function (selling goods/providing a service)

Question 3

Capital expenditure

Answer 3

Used to buy capital items, which are assets that will stay in the business for a long time

Question 4

Revenue expenditure

Answer 4

Spending on items on a day-to-day basis.

Question 5

Fixed assets (non-current assets)

Answer 5

Items of value that are likely to stay in the business for more than 1 year

Question 6

Asset

Answer 6

Any item of value owned by a individual or firm

Question 7

Trade receivables

Answer 7

Money owed to the business from sales made but not yet paid for

Question 8

Trade payable

Answer 8

Money the business owes from supplies purchased but not yet paid for