Analysis Intermediate: Understanding the Balance Sheet

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1.
Shareholder equity is the sum of the companys assets.
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False. The value of assets remaining after all the liabilities have been accounted for belongs to the shareholders.
2.
Balance sheets provide information on a companys stock performance.
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False. Balance sheets provide financial information, but not stock performance information.
3.
How do you know when a document is a balance sheet?
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Its assets equal its liabilities and shareholder equity. To be a balance sheet, all of the assets must equal all of the liabilities and shareholder equity.
4.
Shareholders equity is included in which part of the equation for the balance sheet?
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Liabilities. In the world of the balance sheet, it is a liability because it pays for assets.
5.
Balance sheets balance _______.
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Assets with liabilities. Equity, debt, taxes, and income are all included in assets and liabilities.
6.
Which of the following is not a current asset?
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Stock. Stock is not a current asset. On the balance sheet, it is a liability.
7.
The company E-Publisher.com owns exclusive rights to its material. This copyright is an asset.
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True. Copyright is an intangible asset.
8.
Current liabilities are those that are paid ______.
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Within one year. This is the accepted time limit.