The Amount Shown on the Statement of fiNancial Position as Shareholders

question 33

True/False

The amount shown on the statement of financial position as shareholders' equity represents the current market value of the owners' residual claim against the company.

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Definitions:

Accounts Receivable

Receivables from clients to a corporation for goods delivered or services rendered, pending payment.

Cash

A company's most liquid asset, consisting of currency held and deposits in bank accounts, used for transactions or as reserve for future payments.

Liabilities

Economic responsibilities or liabilities a corporation has towards others, necessitating settlement over time by transferring assets such as cash, products, or services.

Return on Assets

A financial ratio that measures the efficiency of a company's use of its assets in generating profit.