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- 1. Multiple Choice
Businesses use accounts to summarize all the information pertaining to a single item
True
False
- 2. Multiple Choice
The balance of an account increases on the same side as the normal balance side.
True
False
- 3. Multiple Choice
Before a transaction is recorded in the records of a business, it is analyzed to determine which accounts are changed and how
True
False
- 4. Multiple Choice
Each transaction changes the balances in at least two accounts.
True
False
- 5. Multiple Choice
Cash is an asset account with a normal credit balance.
True
False
- 6. Multiple Choice
Capital is an owner's equity account with a normal debit balance.
True
False
- 7. Multiple Choice
The left side of a liability account is the normal balance side because liabilities are on the left side of the accounting equation.
True
False
- 8. Multiple Choice
The normal balance side of an accounts receivable account is a credit.
True
False
- 9. Multiple Choice
Accounts receivable accounts are increased with a debit.
True
False
- 10. Multiple Choice
Advertising Expense is increased with a debit.
True
False
- 11. Multiple Choice
A record summarizing all the information pertaining to a single item in the accounting equation is ____.
a debit
a credit
an account
a T account
- 12. Multiple Choice
In a T account, the debit side is ____.
the left side
the right side
both A and B
neither A nor B
- 13. Multiple Choice
The right side of a T account is the ____.
debit side
credit side
normal balance side
equity side
- 14. Multiple Choice
If an amount is recorded on the side of a T account opposite the normal balance side, the account balance is
increased
decreased
unaffected
correct
- 15. Multiple Choice
The normal balance side of an asset account is the ____.
debit side
credit side
decrease side
right side
- 16. Multiple Choice
When the owner invests cash in a business, the owner's capital account is ____.
increased with a debit
increased by a credit
decreased by a debit
decreased by a credit
- 17. Multiple Choice
When a business pays for insurance, Prepaid Insurance is ____.
increased by a debit
increased by a credit
decreased by a debit
decreased by a credit
- 18. Multiple Choice
When a business buys an asset on one date and agrees to pay on a later date, the transaction is ____.
delayed
on account
increased
none of the above
- 19. Multiple Choice
When a business pays cash on account, a liability account is ____.
increased by a debit
increased by a credit
decreased by a debit
decreased by a credit
- 20. Multiple Choice
When cash is received from sales, the change in the owner's equity is usually ____.
recorded in a separate revenue account
recorded directly in the owner's capital account
recorded as interest revenue
always recorded on the debit side
- 21. Multiple Choice
When a business receives revenue, Sales is ____.
increased by a debit
increased by a credit
decreased by a debit
decreased by a credit
- 22. Multiple Choice
The amount paid for rent is recorded as a debit to ____.
Miscellaneous Expense
Rent Expense
Supplies
Cash
- 23. Multiple Choice
When cash is paid for rent, Rent Expense is ____.
increased by a debit
increased by a credit
decreased by a debit
decreased by a credit
- 24. Multiple Choice
When the owner withdraws cash, the owner's drawing account is ____.
increased by a debit
increased by a credit
decreased by a debit
decreased by a credit
- 25. Multiple Choice
A drawing account has a normal ____.
debit balance and is increased by a debit
credit balance and is increased by a credit
debit balance and is increased by a credit
credit balance and is decreased by a credit
- 26. Multiple Choice
The values of all things owned (assets) are on the accounting equation's ____.
left side
right side
debit side
none of the above
- 27. Multiple Choice
The values of all equities or claims against the assets (liabilities and owner's equity) are on the accounting equation's ____.
left side
right side
debit side
none of the above
- 28. Multiple Choice
An amount recorded on the left side of a T account is
a debit
a credit
normal balance
none of the above
- 29. Multiple Choice
The normal balance side of any liability account is ____.
the debit side
the credit side
the left side
none of the above
- 30. Multiple Choice
The normal balance side of an owner's capital account is ____.
the debit side
the credit side
the left side
none of the above
- 31. Multiple Choice
Debits must equal credits ____.
in a T Account
in the equation's left side
on the equation's right side
in all transactions
- 32. Multiple Choice
Decreases in an asset account are shown on a T account's ____.
debit side
credit side
balance side
none of the above
- 33. Multiple Choice
Decreases in any liability account are shown on a T account's ____.
debit side
credit side
right side
none of the above
- 34. Multiple Choice
Increases in an owner's capital account are shown on a T account's
debit side
credit side
left side
none of the above
- 35. Multiple Choice
Increases in a revenue account are shown on a T account's ____.
debit side
credit side
left side
none of the above
- 36. Multiple Choice
The normal balance side of any revenue account is ____.
the debit side
the credit side
the left side
none of the above
- 37. Multiple Choice
The normal balance side of any expense account is ____.
the debit side
the credit side
the right side
none of the above
- 38. Multiple Choice
When services are sold on account for $500.00
Sales is decreased with a debit and Accounts Receivable is increased with a credit
Sales is increased with a debit and
Accounts Receivable is increased with a credit
Sales is increased with a credit and Accounts Receivable is increased with a debit
Sales is increased with a debit and Accounts Receivable is increased with a debit
- 39. Multiple Choice
When $1,500.00 cash is received on account, ____.
Sales is increased with a credit and Cash is increased with a credit
Accounts Receivable is increased with a debit and Cash is increased with a credit
Accounts Receivable is decreased with a credit and Cash is increased with a debit
Accounts Receivable is decreased with a debit and Cash is increased with a debit
- 40. Multiple Choice
A sale on account ____.
increases an owner's equity account and increases an asset account
increases a liability account and increases an asset account
increases an owner's equity account and increases a liability account
increases an owner's equity account and decreases a liability account
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