Analyzing Business Transactions

Examples of assets are:

• Cash and accounts receivable
• Cash and revenue
• Cash and rent expense
• Investments by the owner and revenue

Amounts that a business must pay in the future are known as:

• Accounts Receivable
• Accounts Payable
• Capital
• Expenses

This type of transaction decreases owner's equity

• purchase of supplies

• revenue

• expense

• investment

The transaction where cash is paid for rent does the following:

• increases cash; increases owner's equity

• decreases cash; decreases owner's equity

• decreases cash; increases owner's equity

• increases cash; decreases owner's equity

Given the options below, identify the correct accounting equation formula:

• Assets = Liabilities + Owner's Equity

• Liabilities = Assets + Owner's Equity

• Assets + Liabilities = Owner's Equity

• Assets + Owner's Equity = Liabilities

Property owned by a business is called:

• Assets
• Liabilities
• Capital
• Income

A sale of goods or services sold on account would have the following affect:

• increase assets; increase owner's equity

• decrease assets; decrease owner's equity

• increase assets; decrease owner's equity

• decrease assets; increase owner's equity

Accounts Payable is

• an asset

• a liability

• an expense

• owner's equity

Accounts Receivable is

• an asset

• a liability

• an expense

• owner's equity

Which of the following transactions involve two assets?

• Bought supplies on account

• Received cash from owner as an investment

• Paid cash for insurance

• Paid cash for rent