Which TWO of the following items are presented within the Equity section of a limited company's Statement of Financial Position?

Answer options:

Share premium account

Bank overdraft

Revaluation surplus

Debentures (Loan notes)

How to approach this question

Identify which items represent the owners' interest in the business (capital and reserves) versus external debt.

Full Answer

The Equity section of a Statement of Financial Position includes Share Capital, Share Premium, Retained Earnings, and other reserves such as the Revaluation Surplus. Bank overdrafts are current liabilities, and debentures are non-current liabilities.

Common mistakes

Confusing long-term debt (debentures) with equity.

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Practice the full ACCA FA — Financial Accounting Practice Exam 4

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