Debit/Credit
You bought $100 worth of supplies. Your supplies account becomes ____?
Debited
Is equipment a long term asset or a current asset?
Long term assets
If I sell an asset such as equipment for more than I bought it, will the equipment account be debited?
False
What accounts are involved in an income statement?
Revenues and expenses
Debts that are owed by a business is what type of liability account?
Accounts Payable
Your 2,500 computer broker after you spilled water on it. What happens to your equipment account?
Credited $2,500
Do your "total assets" and "total liabilities and equity" on a balance sheet have to equal the same number?
Yes
The capital account should ALWAYS be debited
Flase
How do you calculate net income/net loss?
Subtract total expenses to total revenue
Assets - Liabilities =
Owner's Equity
You paid back 100 out of the 500 you owed to Your father. What happens to your A/P account?
Debited $100
On a balance sheet where do you get the opening balance number from?
You get the number from the owner's capital
If the owner removes supplies from the business for personal use you would CREDIT the capital account.
True
Which side of the income statement do totals go?
The right side
An item that is paid for in advance, but one where the benefits extend to the future. A common example is insurance
Prepaid Insurance
You bought a TV, a new laptop and new shoes on account for $3 500. What account will be credited $3 500?
Accounts Receivable account would be credited
Which side of the balance sheet do totals go?
Right coloum
When we pay wages to an employee, we debit to cash and credit Wages expenses
False
What comes first when writing your income statement, revenues or expenses?
Revenues
An informal business paper used to organize and plan information for the financial statements. It is informal because none of the data it contains will be directly posted to accounts.
A worksheet
If I were to purchase a car using cash, would my cash account be credited or debited?
Credited
Is HST Payable and HST Recoverable considerd an asset or liability on the balance sheet?
Liability
When a customer of ours makes a purchase on account you would debit the accounts payable
Flase
Should every number on your income statement have a dollar sign?
No
What method is dividing the net cost of a long term asset equally over it useful lifetime to calculate it’s depreciation
Straight line method