True/False
Indicate whether the statement is true or
false.
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1.
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All accounting transactions are recorded in the accounting equation.
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2.
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The total of amounts on the left side of the accounting equation must always
equal the total of amounts on the right side.
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3.
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In a T account, amounts recorded on the left side are called credits.
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4.
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The owner's capital account is on the right side of the accounting equation
and has a normal credit balance.
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5.
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Account balances increase on the normal balance side of an account.
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6.
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Every transaction must affect accounts on both sides of the accounting
equation.
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7.
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Revenue increases owner's equity and decreases cash.
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8.
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A business paid cash on account. This transaction is recorded by debiting cash
and crediting accounts payable.
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9.
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A business received cash from owner as an investment. This transaction is
recorded by debiting cash and crediting Capital.
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Matching
Use the word list provided below. Not all words will be
used; some may be used multiple times. Copy and paste from the list. Misspellings will be counted as
incorrect.
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A. | credit cash, debit insurance | H. | must be
decreased | B. | owner's equity | I. | debit accounts receivable, credit sales | C. | credit cash, debit
supplies | J. | normal
balance | D. | proprietorship | K. | debit supplies, credit accounts payable | E. | What is the new
balance of each account? | L. | T
account | F. | account | M. | chart of accounts | G. | debit cash, credit accounts
receivable |
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1.
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A business received cash from owner as an investment. This transaction is
recorded by debiting cash and crediting Capital.
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2.
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A record summarizing all the information pertaining to a single item in the
accounting equation is known as a(n) ____.
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3.
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A business paid cash for supplies. How is this transaction recorded?
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4.
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The side of the account that is increased is called the ____.
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5.
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A business paid cash for insurance. How is this transaction recorded?
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6.
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An accounting device used to analyze transactions is called a(n) ____.
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7.
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If one account is increased, another account on the same side of the equation
____.
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8.
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A business sold services on account. How is this transaction recorded?
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9.
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A list of accounts used by a business is called a(n) ____.
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10.
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A business bought supplies on account. How is this transaction
recorded?
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11.
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Which one of the following questions is not asked every time a
transaction is analyzed into its debit and credit parts?
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