The context and purpose of financial reporting

Which of the following items would NOT be included in a sole trader’s capital?

A Equity share capital
B Revaluation surplus
C Personal drawings
D Capital account

6. 
   Which of the following statements best defines an asset?
   

A An asset is a resource owned by the entity with a financial value.
B An asset is a resource controlled by an entity from which future economic benefits are expected to be generated.
C An asset is a resource controlled by an entity as a result of past events.
D An asset is a present economic resource controlled by the entity as a result of past events.

6. 
   Which of the following statements best defines the equity or capital of a business?
   

A Equity or capital of a business is represented by the net assets of the business
B Equity or capital of a business is equivalent to the value of the business
C Equity or capital of a business is equivalent to the value of the business assets
D Equity or capital of a business is represented by the total assets of the business
THE QUALITATIVE CHARACTERISTICS OF FINANCIAL INFORMATION

6. 
   Identify whether each of the following characteristics is a fundamental qualitative characteristic or an enhancing qualitative characteristic of useful financial information according to in the IASB’s Conceptual Framework for Financial Reporting.
   

	Fundamental qualitative characteristic	Enhancing qualitative characteristic
Comparability
Timeliness
Faithful representation
Understandability

6.