Accounting Quiz Bee 1

When cash is received from a customer in payment for an account receivable, how are the elements of the accounting equation affected?

• Decrease assets (cash and increase assets (accounts receivable)

• Increase assets (cash) and decrease assets (accounts receivable)

• Increase assets and increase liabilities

• Increase assets and increase equity

The recording of financial transactions and events manually or electronically is called which of the following?

• Bookkeeping

• Budgeting

• Auditing

• Reporting

If at the end of the accounting period the liabilities total $18,000, and equity totals $32,000, then what must be the total of the assets?

• $14,000

• $18,000

• $32,000

• $50,000

The investment of cash in the business will result in which of the following?

• An increase in cash and a decrease in equity

• An increase in cash and an increase in equity

• A decrease in cash and an decrease in liabilities

• An increase in fees earned and an increase in equity

Withdrawals increase equity.

• TRUE

• FALSE

Purchasing equipment on account will have what effect on the components of the accounting equation?

• Increase in equipment and a decrease in equity

• Increase in equipment and an increase in equity

• Increase in equipment and an increase in liabilities

• Increase in equipment and a decrease in liabilities

Which of the following is not an equity account?

• Owner's Capital

• Owner's Withdrawals

• Revenue

• Unearned Revenue

An account titled Prepaid Rent would be classified as which of the following?

• Asset account

• Liability account

• Revenue account

• Expense account

Which of the following statements is true?

• Journalizing precedes posting

• Revenue accounts are increased by debit entries

• Debit entries are entries involving the right-hand side on an account

• Journalizing errors should be erased and a correct entry made

Total revenues were $105,000, total expenses, except for wage expense were $50,000, and net income was $35,000. What was the amount of wage expense?

• $15,000

• $20,000

• $55,000

• $70,000