Extended Accounting Equation - Revenue, Expenses, Dividends

What are assets in accounting?

• Things that one owes on

• Things that one owns

• The amount of money an owner has invested into the company

• The relationship between assets, liabilities, and owner's equity

What are liabilities in accounting?

• Things that one owes on

• Things that one owns

• The amount of money an owner has invested into the company

• The relationship between assets, liabilities, and owner's equity

What is owner's equity in accounting?

• Things that one owes on

• Things that one owns

• The amount of money an owner has invested into the company

• The relationship between assets, liabilities, and owner's equity

What is the fundamental basis of the double-entry bookkeeping system?

• Assets = Liabilities + Owner's Equity

• Debits equal credits

• Equal and opposite entries

• The balance sheet equation

What is the purpose of the accounting equation?

• To evaluate the company's financial health

• To prepare a balance sheet

• To ensure the books are balanced

• All of the above

If a coffee shop sells 800 cups of coffee for $1.75 each, what is their revenue?

• $1,400

• $1,750

• $1,600

• $1,200

What is the extended accounting equation?

• Assets = Liabilities + Owner's Equity

• Assets = Liabilities + (Revenue - Expenses)

• Assets = Liabilities + (Expenses - Dividends)

• Assets = Liabilities + (Revenue - (Expenses + Dividends))

What is the purpose of a balance sheet?

• To evaluate the company's financial health

• To prepare a balance sheet

• To ensure the books are balanced

• All of the above

If a coffee shop owner has $70,000 in assets, $15,000 in liabilities, $8,000 in expenses, and paid $3,300 in dividends, what is their revenue?

• $66,300

• $55,000

• $70,000

• $11,300

What is the net effect of equal and opposite entries in double-entry bookkeeping?

• Balance

• Revenue

• Expenses

• Liabilities