Understanding Financial Statements and Accounting - Choctaw Nation Small Business Development

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1. It is important to have separate accounts for your business and your personal finances in order to stay organized.*

False
True

2. Businesses need to have a seamless transaction system to make the buying process as easy as possible for their customers.*

False
True

3. The Income Statement, or Profit and Loss Statement, is used to calculate net income by tracking*

Total revenue and total expenses
Total revenue, total costs of goods sold, and total expenses
Fixed overhead and variable expenses
Total revenue, assets, and total expenses

4. Income statements reflect net income for a period of 90 days or one quarter.*

True
False

5. The balance sheet will reflect the financial health of a business at any point in time.*

False
True

6. Assets are broken into two categories*

Current assets and Fixed assets
Current assets and Liquid assets
Leased assets and Purchased assets
Rental/Loaner assets and Fixed assets

7. Liabilities are broken into two categories-current and long term liabilities. Current liabilities are debts that must be satisfied within __________.*

1 year
45 days
90 days
6 months

8. Assets = Equity + Liabilities*

False
True

9. Equity = Assets – Liabilities*

True
False

10. What are the three reports that this video overviews?*

Income Statement, Balance Sheet, and Cash Flow Statement
Income Statement, Operations Statement, and Investment Cash Flow
Profit and Loss Statement, Operations Statement, and Cash Flow Statement
Profit and Loss Statement, Balance Sheet, and Operations Cash Flow