FAC 1503
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FAC 1503 6
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Question 1 
Please match the accounting term with the most suitable definition, example or description provided. 
 
 
B. Reflects the cash inflows and outflows of the business for a specific period. 
C. Reflects: Assets = Equity + Liabilities 
 
 
1.	Statement of financial position 
2.	Statement of changes in equity 
3.	Statement of cash flows 
 
 
Question 2 
Solvency is the availability of cash and other items, which can easily be converted into cash to pay short term debt. 
True False 
 
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FAC 1503•FAC 1503