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WAEC Financial Accounting 2020 Question 39

Question 39

Accounting Equation

Accounting equation of a business shows the

  1. A.current assets and current liabilities only.
  2. B.difference between current assets and liabilities.
  3. C.assets and the sources of financing them.
  4. D.owner's interest in the business only.
Show the answer and explanation

Answer: C (assets and the sources of financing them.)

Explanation

Assets = capital + liabilities: the assets and where the money for them came from.