Review on Basic Accounting Concepts

In September when the company receives the P2,000 from the customer, which account should the company DEBIT?

• Sales

• Cash

• Accounts Receivable

• Accounts Payable

To INCREASE the balance of ACCOUNTS PAYABLE, would you debit the account or would you credit the account?

• Credit

• Debit

To DECREASE the balance of SUPPLIES EXPENSE, would you debit the account or would you credit the account?

• Credit

• Debit

To DECREASE the balance of UNEARNED REVENUE, would you debit the account or would you credit the account?

• Credit

• Debit

What is the normal balance of Prepaid Insurance?

• Debit

• Credit

The account's word to indicate that an entry will be recorded on the left-side of an account is

• Debit

• Credit

The contra-asset account such as Accumulated Depreciation will likely have which balance?

• Debit

• Credit

The basic accounting equation is Assets = Liabilities + (a)  

The owner invests personal cash in the business. Cash will ____________________

• Increase

• Decrease

• No effect

The company receives cash from a bank loan. Owner's equity will ____________________

• Increase

• Decrease

• No effect