Statment of financial position- pages 31-32

Question 1

Statement of financial position

Answer 1

A financial snapshot of the assets and liabilities of an enterprise on a particular day, usually the last day of the year (31 December)

Question 2

Purpose of financial position

Answer 2

• The value of all the enterprise’s assets and liabilities

- The source of capital used by enterprise to finance it operations

Question 3

How do you prepare a financial position statement?

Answer 3

You need to categorise the enterprise’s assets into fixed and current and its liabilities into current and long-term liabilities

Question 4

What is the layout of the statement of financial position?

Answer 4

• Fixed assets
• Current assets
• Current liabilities
• Net current assets
• Financed by