Posted: March 30th, 2016

An individual asset has increased. Which of the following is possible?

1. There are relatively few types of revenue. Which of the following in NOT a type of revenue? (Points : 1)
Common Stock
Service
Interest
Sales
2. Which of the following accounts is an asset? (Points : 1)
Cash
Notes payable
Drawing
Expenses
3. An owner invests $20,000 in her new business by depositing the cash in the business s checking account. Which account is credited? (Points : 1)
Accounts receivable
Cash
Capital
Accounts payable
4. A trial balance is the list of all a company s accounts along with their account numbers. (Points : 1)
True
False
5. Which of the following accounts decreases with a debit? (Points : 1)
Notes payable
Prepaid insurance
Cash
Land
6. An individual asset has increased. Which of the following is possible? (Points : 1)
There is an equal decrease in another asset.
There is an equal decrease in owner s equity.
There is an equal decrease in a liability account.
Both liabilities and owner s equity decrease.
7. A business renders service to a client and sends out a sales invoice. The amount will be collected from the customer at a later time. Which of the following would be TRUE at the time when the invoice is sent out? (Points : 1)
Owner s equity will decrease.
Total liabilities will increase.
Total assets will decrease.
Net income will increase.
8. By definition, which of the following represents the owners of a corporation? (Points : 1)
Customers
Creditors
Stockholders
Employees
9. Scott s Camera Shop started the year with total assets of $80,000 and total liabilities of $40,000. During the year, the business earned revenues of $120,000 and incurred expenses of $70,000. Scott made no capital contributions during the year, but did make withdrawals of $60,000.
What is the amount of Scott s net income for the year? (Points : 1)
$50,000
$10,000
$30,000
$40,000
10. A business settles a liability by making a payment with cash. How does paying this liability affect the accounting equation? (Points : 1)
Assets decrease; liabilities decrease.
Liabilities decrease; owner s equity increases.
Assets increase; liabilities increase.
Assets increase; liabilities decrease.