Accounting Methods Basics - Grade 10
This worksheet covers fundamental accounting methods, including definitions of key terms, identification of asset and liability accounts, and basic accounting equation applications.
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Accounting Methods Basics
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Read each question carefully and answer to the best of your ability. Show your work where applicable.
1. The basic accounting equation is Assets = + Owner's Equity.
2. An item of value owned by a business is called an .
3. Obligations owed to others are known as .
4. The financial statement that reports a company's assets, liabilities, and owner's equity at a specific point in time is the .
5. Which of the following is an example of a liability?
Cash
Accounts Payable
Equipment
Owner's Capital
6. The revenue recognition principle states that revenue should be recognized when:
Cash is received
The service is performed or goods are delivered
A bill is sent to the customer
The company makes a profit
7. Briefly explain the difference between current assets and non-current assets, providing one example for each.
8. A business has total assets of $50,000 and total liabilities of $20,000. Using the accounting equation, calculate the owner's equity.
9. Depreciation is the process of allocating the cost of a tangible asset over its useful life.
True
False
10. The Statement of Cash Flows shows a company's revenues and expenses over a period of time.
True
False
Match the accounting term with its definition.
11. Revenue
a. The cost of doing business
12. Expense
b. Money earned from sales or services
13. Owner's Equity
c. The owner's claim to the assets of the business