Current liabilities are the liabilities that the company has to pay either with cash of by handling goods or services within one year or in an operating cycle.

Statement of owner’s equity reports the changes in the capital throughout the period caused by the owner’s capital investments or withdrawals, net profit or loss.

Sales 

Therefore, information given in the financial statements must be relevant, faithfully representable, comparable, verifiable, timely and understandable.

The book value represents the cost invested in the asset that the business has not yet expensed or unexpired, in other words, reminder usefulness of plant asset. The correct answer is A.

In accrued expense, expense is recognized before the cash is paid.

There are three elements which reflect the financial situation of an organization: Assets, liabilities, and owner’s equity. The correct answer is C.

In a general sense, Accounting is an information system which provides financial information about the entity for decision makers. This system includes three kinds of basic activities which are identifying, recording and communicating of the financial transactions of an entity.

Liabilities, contributions, and revenues increase by crediting (on right side) and normally show credit balance. The correct answer is C.

Revenues and expenses are reported in the income statement; assets, liabilities and owner’s equity are reported in the balance sheet.

The time-period concept (or alternatively periodicity concept) assumes that unlimited economic life of a company will be divided into artificial time periods and that financial statements can be prepared for specific periods such as a month, quarter, or year.

The Ledger is a record of all the accounts that the company uses the changes in those accounts, and their balances.

Residual value is the expected value of the plant asset at the end of its useful life. 

The correct answer is B.

Owner’s Capital account represents the net contribution of the owner in the business.

skills / knowledge

Accounting standards are a set of principles and rules that companies follow when they prepare and publish their financial statements, providing a standardized way of describing the company’s financial performance.

If the sum of the left side exceeds the sum of the right side of an account, a debit balance occurs. In other words, debit balance shows the difference between the total amounts of the left and the right side where the debit amount exceeds the credits.

Investors and creditors  

It should be ''Decide whether each account increases or decreases and then apply the rules of debits and credits''.As second step