What are assets in the context of a company's balance sheet?

Resources held by a company that contribute to revenue generation Liabilities and shareholder equity Expenses incurred in day-to-day operations Profits generated over a specific period

What is the key distinction between non-current assets and current assets?

Non-current assets are tangible, while current assets are intangible Non-current assets are expected to provide economic benefits for over a year, while current assets are expected to be consumed within a year Non-current assets are listed on the liabilities side of the balance sheet, while current assets are on the assets side Non-current assets represent investments, while current assets represent operational resources

What are fixed assets?

Assets that can be easily converted to cash Short-term investments with a maturity of less than three months Assets that are difficult to liquidate and provide long-term economic benefits Expenses related to the daily operations of a business

How is the net block of an asset calculated?

Gross block multiplied by the accumulated depreciation Gross block plus accumulated depreciation Accumulated depreciation divided by the gross block Gross block minus accumulated depreciation

What does 'Capital Work in Progress' (CWIP) represent on the balance sheet?

Completed assets that are ready for use Intangible assets under development, such as patents Investments in long-term financial instruments Assets under construction or assembly that have incurred capital expenditure

Which of the following is a characteristic of current assets?

They are expected to be held for more than one year They are difficult to convert into cash They are used to fund long-term investments They are expected to be consumed or converted into cash within a year

What does 'Trade Receivables' (Accounts Receivables) represent?

Money owed by the company to its suppliers Money owed to the company by its customers Cash and cash equivalents readily available Short-term loans and advances expected to be repaid within a year

What is the fundamental accounting equation that ensures the balance sheet is balanced?

Assets = Liabilities - Shareholder Equity Assets = Shareholder Equity - Liabilities Assets = Liabilities + Shareholder Equity Assets = Revenue - Expenses

How does the Profit After Tax (PAT) from the Profit & Loss (P&L) statement connect to the balance sheet?

PAT is recorded as an expense on the balance sheet PAT is added to the company's liabilities PAT increases the company's accumulated depreciation PAT contributes to the shareholder equity section of the balance sheet

How does an increase in debt financing generally affect the P&L statement?

It increases revenue from sales It reduces operating expenses It increases finance costs It decreases other income