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Knowledge
Transactions
Terminology
100

A decrease in a liability is a...

Debit
100

What is debited if a company pays cash to an accounts payable to lower the amount owed?

Accounts payable

100

What is the left side of an account?

Debit

200

An increase in Equity is a...

Credit

200
Which account is credited if a barber shop performs a haircut for $25?

Capital

200

What is the right side of an account?

Credit 

300

What is crucial for the double-entry system of accounting?

The total of the debit entries must equal the total of the credit entries.

300

What accounts are affected when a company makes a down payment on a truck for $2000, and a promise to pay the balance of $8000 at a later date?

Vehicles/Trucks, Accounts Payable, Capital.

300

What is an account?

A record that documents changes to items in the accounting equation.