Accounting: Long Term Investments and Tangible Assets Quiz

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Questions and Answers

What is the primary characteristic of non-current liabilities?

  • They are not due for payment within one year after the year-end date (correct)
  • They are due for payment within one year after the year-end date
  • They are not recorded on the balance sheet
  • They are due for payment immediately

Which of the following is an example of equity or owner's equity?

  • Accounts receivable
  • Accounts payable
  • Rent expense
  • Capital (correct)

What is the relationship between drawing and capital?

  • Drawing is a part of capital
  • Drawing and capital are unrelated
  • Drawing decreases capital (correct)
  • Drawing and capital are the same thing

Which of the following is an example of revenue or income?

<p>Sales for merchandising and manufacturing companies (A)</p> Signup and view all the answers

What is the relationship between income and expenses?

<p>Income increases and expenses decrease resources (B)</p> Signup and view all the answers

Which of the following is an example of a non-current asset?

<p>Property, plant, and equipment (D)</p> Signup and view all the answers

What is the purpose of accrued income?

<p>To record income that has been earned but not yet received (D)</p> Signup and view all the answers

Which of the following is an example of a tangible asset?

<p>Buildings (C)</p> Signup and view all the answers

What is the purpose of long-term investments?

<p>To diversify the business's assets (A)</p> Signup and view all the answers

Which of the following is not a characteristic of current assets?

<p>Not expected to be converted into cash within one year (B)</p> Signup and view all the answers

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