Balance Sheets
The Tree Doctor Buys Acorn IndustriesThe Tree Doctor revealed today that it has purchased Acorn Industries. Acorn's balance sheet shows that its assets, especially the oak farm, make it a solid purchase. Acorn's liabilities of about $50,000 consist primarily of money Acorn owes in back taxes…
WHAT DO YOU KNOW?
Circle T or F to indicate whether each of the following statements is true or false.| Q1 |
T |
F |
1. Acorn Industries is broke. |
|
A1:
| False. They own an oak farm, at least, and it is an asset. |
| Q2 |
T |
F |
2. A liability is the ability to give false financial information. |
|
A2:
| False. A liability is money owed by a firm. |
| Q3 |
T |
F |
3. A balance sheet reports the financial health of a company. |
|
A3:
| True. |
|
TERMS RELATED TO BALANCE SHEETS
assets
the property, cash, amounts due, and so on owned by a companyliabilities
the debts, amounts owed, and so on of a companybalance sheet
a report showing the dollar value of a firm's assets and liabilities at a particular point in time |
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