No matter how small your business is and what industry you are in, your company has assets. From a computer to a processing plant, every single thing your company owns is an asset.

Assets can be in different forms. Some assets are physical, such as computers, filing cabinets, and delivery vans. Others are legally binding promises, such as accounts receivable, the money owed to your company. Still others seem to exist more on paper, for example, a year’s worth of insurance paid in advance. No matter what form it takes, anything with monetary value that your company owns counts as an asset.

Assets appear on your balance sheet, reporting the key financial statements at the end of each accounting period. Your assets will be split into different types to make analysis easier. The order in which you list them on the balance sheet typically matches the way they appear in your chart of accounts.

Assets do more than just show up on reports, though. They are the resources your company uses to produce revenue. Your business cannot bring in sales without assets. For product-based businesses, you can’t produce anything without proper assets. It’s true for service companies as well. At least, you must have cash to pay your expenses and to help get the word out that your company exists. Service companies also need basic tools to provide service to customers: a hair stylist needs a chair, scissors, and styling tools; an accountant needs a computer and a lot of file cabinets. Assets are key factors for any business.

 

1.Accounts receivable is not physical asset.   (1)   

A. T

B. F

2.According to the passage, assets appear on the income statement.   (2)   

A. T

B. F

3.Every business can bring in sales without assets.   (3)   

A. T

B. F

4.An accountant is responsible for bookkeeping.   (4)   

A. T

B. F

5.The passage is discussing if every business has assets or not.   (5)   

A. T

B. F