Accounting Basics Worksheet

Name:

Date:

📚 Part 1: Knowledge Check (WALT & Success Criteria)

WALT: Understand basic accounting terms and the purpose of accounting.

Success criteria: I can define asset, liability, equity, revenue and expense; and choose correct examples.

1. What is the main purpose of accounting?

To record and report financial information so businesses can make informed decisions

To design marketing materials

To calculate temperatures in Celsius (°C)

To measure distances in kilometres

2. Which of the following is an asset for a small retail business?

Inventory (stock)

Bank loan (what the business owes)

Owner’s drawings

Rent expense

3. Check all that apply: Which items are expenses?

Rent paid for the shop

Sales revenue

Wages paid to staff

Owner’s capital introduced

4. Match each term (left) with the correct definition (right). Draw a line between columns.

1. Asset

2. Liability

3. Equity

4. Revenue

A. Money earned from selling goods or services

B. Resources owned by the business (e.g., cash, equipment)

C. Amounts the business owes to others

D. Owner’s interest in the business after liabilities

✏️ Part 2: Apply the Accounting Equation

WALT: Apply Assets = Liabilities + Equity to simple business scenarios.

Success criteria: I can calculate equity and explain how transactions affect the equation.

5. Write the accounting equation in words:

6. Calculate equity. Show your working.

Example: A small café has $5,000 cash and $2,000 equipment (assets). It owes $1,500 to a supplier (liability).

7. A business earns $800 revenue and pays $300 in expenses. How does equity change? Show the calculation and state whether equity increases or decreases.

8. Reflection: In one sentence, explain why the accounting equation must always balance.

9. Extension (advanced learners — optional): For each transaction state whether Assets, Liabilities or Equity increases/decreases. Explain briefly.

a) Owner invests $2,000 cash into the business. _______

b) Business takes out a $1,200 loan from the bank. _______

Support & Challenge

Differentiation strategies: Pair work and guided scaffolding for learners who need it; use calculators as required; provide visual examples and sentence starters for EAL learners.

Extension activities: Analyse how multiple transactions affect equity over time; begin simple journal entries; research a local NZ business and list examples of assets and liabilities.