The accounting equation may be expressed as
a. owner's equity = assets - liabilities.
b. revenue - expenses = net income.
c. revenue = net income - expenses.
d. liabilities - owner's equity = assets.
What is: a. owner's equity = assets - liabilities.
100
Jason purchased office equipment for $4,800 on account. This transaction would
a. increase assets and increase owner's equity.
b. increase assets and increase liabilities.
c. increase one asset and decrease another asset.
d. decrease assets and decrease liabilities.
What is: b. increase assets and increase liabilities.
100
Stephen purchased office supplies for $800 in cash. This transaction would
a. increase assets and increase owner's equity.
b. increase one asset and decrease another asset.
c. increase assets and increase liabilities.
d. decrease assets and decrease liabilities.
What is: b. increase one asset and decrease another asset.
100
Meghan started her business by investing $30,000 in cash. This transaction would
a. increase assets and increase owner's equity.
b. increase assets and increase liabilities.
c. increase one asset and decrease another asset.
d. decrease assets and decrease liabilities.
What is: a. increase assets and increase owner's equity.
100
When you buy property and agree to pay for it later, you are buying ______ _________________.
What is on credit?
200
Increases to owner's equity may be from
a. expenses that are incurred.
b. expenses exceeding revenue for the period.
c. withdrawals of cash from the business by the owner.
d. revenue that is derived from sales of goods or services.
What is:
d. revenue that is derived from sales of goods or services.
200
Tyler paid $3,700 on account to the company from which equipment was purchased on credit. This transaction would
a. decrease assets and decrease liabilities.
b. increase assets and increase owner's equity.
c. increase assets and increase liabilities.
d. increase one asset and decrease another asset.
What is:
a. decrease assets and decrease liabilities.
200
An example of an expense is
a. investments.
b. supplies consumed.
c. prepaid insurance.
d. withdrawals by the owner.
What is:
b. supplies consumed.
200
A decrease in owner's equity may result from a(n)
a. purchase of office supplies for cash.
b. withdrawal of cash from the business by the owner.
c. revenue that is derived from sales of goods or services.
d. investment of cash in the business by the owner.
What is:
b. withdrawal of cash from the business by the owner.
200
The business or person selling you the property on credit is a _________________.
What is creditor?
300
Accounts that affect owner's equity are
a. assets, capital, and revenue.
b. capital, liabilities, and expenses.
c. expenses, capital, and drawing.
d. drawing, assets, and liabilities.
What is: c. expenses, capital, and withdrawals
.
300
Income earned from the sale of goods or services is _______.
What is revenue?
300
Falana received $7,000 in cash from a client for professional services rendered. This transaction would
a. increase assets and increase owner's equity.
b. decrease assets and increase owner's equity.
c. increase liabilities and decrease owner's equity.
d. decrease assets and decrease owner's equity.
What is:
a. increase assets and increase owner's equity.
300
Sue Lee paid $1,200 for office rent. This transaction would
a. increase assets and decrease owner's equity.
b. increase assets and increase liabilities.
c. decrease assets and decrease liabilities.
d. decrease assets and decrease owner's equity.
What is:
d. decrease assets and decrease owner's equity.
300
In accounting, property or items of value owned by a business are referred to as _____________.
What are assets?
400
Accounts that affect owner's equity are
a. assets, capital, and revenue.
b. capital, liabilities, and expenses.
c. expenses, capital, and drawing.
d. drawing, assets, and liabilities.
What is:
c. expenses, capital, and drawing.
400
The owner's claim to the assets of the business are ________.
What is owner's equity?
400
A cash payment on a loan affects which of the following accounts?
a. Cash and Accounts Receivable
b. Cash and Accounts Payable
c. Cash and an expense account
d. Cash and a revenue account
What is:
b. Cash and Accounts Payable
400
The drawing account should be used to show
a. the amount the owner has invested in the business.
b. the amount the owner has taken out of the business.
c. the amount the business has earned.
d. the amount the business has spent.
What is:
b. the amount the owner has taken out of the business.
400
The total amount of money owed to a business representing the money to be received later for the sale of goods or services.
What is accounts receivable?
500
An ____________________ is the price paid for goods or services to operate a business.
What is expense?
500
The fact that each transaction has a dual effect on the accounting elements provides the basis for what is called
a. single-entry accounting.
b. compound-entry accounting.
c. multiple-entry accounting.
d. double-entry accounting.
What is:
d. double-entry accounting.
500
__________________ is anything of value that is owned or controlled.
What is property?
500
Dollar amounts measure both the cost of the property and the property rights or ________________ _________________.
What is financial claims?
500
The amount of money owed to the creditors of a business for property or services purchased.