Grade 8 EMS | Term 2 Lesson 2 | The Accounting Equation

What is the Accounting equation?  *

• Assets = Owner's equity + Liabilities

• Transactions

• Journals

• Trial Balance

The following are examples of a service business.*

• Wedding planners

• Hairdressers

• Electricians

• All of the above

The following are examples of fixed assets.*

• Bank, Land & Buildings, Equipment

• Vehicles, Cash float, Equipment

• Equipment, Vehicles, Petty cash

• Vehicles, Equipment, Land & Buildings

State whether the following statement is true or false? Capital and income increases your owner's equity.  

• True

• False

State whether the following statement is true or false?  Drawings is an expense

• True

• False

State whether the following statement is true or false?  Capital is not an income

• True

• False

State whether the following statement is true or false?  When an amount is directly deposited in the bank account, you entered it in the analysis of receipts column in the CRJ.

• True

• False

Show the effect on the accounting equation of the following transaction. The owner deposits R500 000 in the bank account of the business.

• Assets increases and decreases with R500 000

• Assets and owners' equity increases with R500 000

• Assets decreases with R500 000

• None of the above

The following documents are used in the CRJ*

• Receipt

• Cash register roll

• Deposit slip

• All of the above

 What is the name for services rendered?  *

• Current income

• Capital

• Rent income

• None of the above