Identify the Basic Formula of a Balance Sheet and Give

question 20

Essay

Identify the basic formula of a balance sheet and give an example of an item that might fall under each major component of the formula.
A.Assets = liabilities + owners equity
B.Assets - two categories
1.current - include cash and anything else that is expected to be converted into cash or consumed in the operation of the business during a period of one year or less.Examples: cash,inventory,accounts receivable
2.fixed - Fixed assets are those that are tangible and will be used over a long period of time.Example: equipment
C.Liabilities - two categories
1.current - due within one year,example accounts payable
2.long-term - anything due over one year,example notes payable/bank loan
D.Owner's Equity

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Definitions:

Personality Attribute

A characteristic or quality that defines or contributes to an individual's distinct personality, such as traits, behaviors, and attitudes.

Locus Of Control

A psychological concept that refers to individuals' beliefs about the extent to which the outcomes of their actions are under their own control (internal locus) or beyond their control and determined by external forces (external locus).

Extraversion

A personality trait characterized by outgoingness, high energy, and sociability.

Openness

A personality trait that features characteristics of imaginative, curious, and open-minded individuals, often associated with a willingness to experience new things.