| A | B |
|---|
| An amount of money taken out of the business by the owner is a ______. | Withdrawal |
| ______ record business income only. | Revenue accounts |
| The ______ account shows the amount of the owner’s investment, or equity, in a business. | Capital |
| Accounts that are used to record information continuously from one accounting period to the next are called ______. | Permanent accounts |
| ______ are used to record the costs and services used by a business. | Expense accounts |
| Recognizing and recording revenue on the date it is earned even if cash has not been received on that date is known as the ______. | Revenue recognition principle |
| The normal balance side for a revenue account is the debit side. | False |
| “Credit” means the increase side of an account. | False |
| A credit to an expense account decreases the account balance. | True |
| Withdrawals are increased on the debit side. | True |
| Revenue is increased on the credit side. | True |
| Expenses are decreased on the credit side. | True |
| The basic accounting equation may be expressed A = L + OE. | True |
| The left side of a T account is always the debit side. | True |
| You may have two debits and one credit as long as the amounts are equal | True |
| A debit to an expense account and a credit to a capital account will result in the basic accounting equation being out of balance. | False |
| Capital is always increased by credits. | True |
| Debits decrease the withdrawals account. | False |
| The costs of doing business are known as ______. | Expenses |
| The balance of a(n) ________ account does not carry forward to the next accounting period. | Temporary capital |
| Money a business earns from the sale of goods or services is the ______. | Revenue |
| The dollar balance of a(n) ______ account is carried forward from one period to the next. | Permanent |
| A(n) ______ occurs when the owner takes assets out of the business for personal use | Withdrawal |
| When a business follows the GAAP of ______, revenue is recorded on the date it is earned. | Revenue recognition |
| Liability, expense and capital accounts all have normal credit balances | False |
| Expenses decrease owner’s equity and are recorded as debits | True |
| The rules of debit and credit for expense accounts are the same as the rules for asset accounts. | True |
| A business should have separate accounts for recording revenue and expenses. | True |
| Liability, revenue and withdrawal accounts all have normal credit balances | False |
| The withdrawal of cash by the owner of a business decreases owner’s equity | True |
| Expenses have the opposite effect from revenue on the capital account. | True |
| Temporary capital accounts are extensions of the owner’s capital account. | True |
| Permanent accounts start each accounting period with a zero balance. | False |
| Revenues increase owner’s equity, and increases in revenues are recorded as debits. | False |
| The total of all accounts with normal debit balances should equal the total of all accounts with normal credit balances if the rules of debit and credit were followed correctly. | True |
| The normal balance for expense accounts is a ______. | Debit |
| The normal balance for the owner’s withdrawals account is a ________. | Debit |
| An increase to a revenue account is a ________. | Credit |
| An increase to the withdrawals account is a _______. | Debit |
| A decrease to an expense account is a _______. | Credit |
| The left side of a T account is a _______. | Debit |
| The normal balance for consulting fees is a ______. | Credit |
| An increase to utilities expense is recorded as a _______. | Debit |
| An increase to Mark Cookson, Withdrawals is recorded as a ______. | Debit |
| A decrease to collection fees is recorded as a _______. | Debit |
| Billed A & S Equipment, a customer, $875 for services provided. | Debit=Accounts Receivable, Credit=Fees |
| Received $925 for services provided to Abruzzi Construction. | Debit=Cash in Bank, Credit= Fees |
| Bought $175 of office supplies on credit from North Supply Inc | Debit=Office Supplies, Credit=Accounts Payable |
| Issued a check for $300 to buy office equipment | Debit= Office Equipment, Credit=Cash in bank |
| Paid by check the $125 monthly heating bill | Debit=Utilities Expense, Credit=Cash in bank |
| Received $550 in cash for services billed earlier to A &S equipment | Debit=Cash in Bank, Credit= Accounts Receivable |
| Dale Orondo wrote a check for $200 for personal use | Debit= D. Ornondo, Withdrawals, Credit= Cash in bank |
| Issued a check to pay the $800 rent for the month | Debit= Rent Expenses, Credit= Cash in bank |
