Accounting Basics
$100: The financial equation is Assets = Liabilities + _____.
Answer: What is Owner’s Equity?
$100: This financial statement shows a company’s revenue and expenses.
What is the Income Statement?
$100: Assets increase with a ____.
Answer: What is a Debit?
$100: Buying supplies on account increases Supplies and increases ____.
Answer: What is Accounts Payable?
$100: A record of all accounts used by a business.
Answer: What is the Ledger?
$200: The language of business is called ____.
What is Accounting?
$200: The balance sheet shows Assets, Liabilities, and ____.
What is Owner’s Equity?
$200: Liabilities increase with a ____.
Answer: What is a Credit?
$200: If cash is received for services, which account increases besides Cash?
Answer: What is Revenue (Service Revenue)?
$200: A list of accounts and their balances to check equality of debits and credits.
Answer: What is the Trial Balance?
$300: The side of a T-account that increases assets.
What is the Debit side?
$300: A list of assets such as cash, accounts receivable, and supplies is found on this statement.
Answer: What is the Balance Sheet?
$300: Recording the same amount on both sides of a transaction is called ____.
Answer: What is Double-Entry Accounting?
$300: The account used when money is owed to a business by its customers.
Answer: What is Accounts Receivable?
$300: The promise to pay in the future is called a ____.
Answer: What is a Liability?
$400: The principle that states expenses should be recorded in the same period as revenues.
Answer: What is the Matching Principle?
$400: Net Income is calculated as Revenues minus ____.
Answer: What are Expenses?
$400: When the owner invests cash, which account is credited?
Answer: What is Owner’s Equity (Capital)?
$400: When equipment is bought with cash, which account decreases?
Answer: What is Cash?
$400: Money owed to the business is recorded as ____.
Answer: What is Accounts Receivable?
GAPP Stands for?
Generally Accepted Accounting Principles
$500: The financial statement that shows how money moves in and out of the business.
Answer: What is the Statement of Cash Flows?
$500: When a company pays off a loan, which account is debited?
Answer: What is Liabilities (Loan Payable)?
$500: If the owner withdraws cash for personal use, the account affected is ____.
Answer: What is Drawing/Owner’s Withdrawals?
$500: The principle that requires accountants to report assets at their actual cost.
Answer: What is the Historical Cost Principle?