Response to the following questions:
1. Which of the following events is not a transaction that would be recorded in a company's accounting records?
1 The purchase of equipment for cash.
2 The purchase of equipment on account.
3 The investment of additional cash in the business by the owner.
4 The death of a key executive.
2. Which of the following are considered "external users of financial statements?
1 Owners.
2 Creditors.
3 Labour unions.
4 All three are external users.
3. A strong statement of cash flows shows that significant cash is being generated by
1 operating activities.
2 Financing activities.
3 investing activities.
4 Effective tax planning.
Use the following to answer questions 4-5:
At December 31, 2015, the accounting records of Sklar Corporation contain the following items:
Accounts payable R 16 000
Accounts receivable R 40 000
Land R 240 000
Cash R 120 000
Equity Shares Equipment R 190 000
Building R 180 000
Short term loans- Retained Earnings R 160 000
4. Refer to the above data. (a) If Equity Shares is R260,000, the amount of Cash owned by Sklar Corporation at December 31, 2015, is 1 R86 000 2 R94 000 3 R 46 000 4 R 686 000
5. Refer to the above data.
If Equity Shares is R320,000, total assets of Sklar Corporation at December 31, 2015, amount to:
1 R 686 000
2 R 926 000
3 R 726 000
4 R 106 000