FBLAACCT1 2004

1. When a business uses a petty cash fund, the fund is debited each time it is replaced.

• True
• False

2. A debit to an account is always an increase.

• True
• False

3. When a business buys equipment, the bookkeeper credits the asset account.

• True
• False

4. To determine the interest on a promissory note, the accountant will need to know principal, interest, rate and term.

• True
• False

5. A payee is the person or business to whom a check is payable.

• True
• False

6. Today the Federal Tax Reform law only requires persons who are over two years old to have a social security number.

• True
• False

7. A bonus, rather than a commission, is an amount paid to an employee as a percentage of sales.

• True
• False

8. Depreciation is allocating the cost of a plan asset over the asset's useful life.

• True
• False

9. When the accountant debits the withdrawals account, this will result in a decrease to the account.

• True
• False

10. Straight-line depreciation is allocating the cost of a plant asset equally over its useful life.

• True
• False