The Accounting Equation and the Double Entry System

A credit entry decreases the balance of

• assets

• income

• liabilities

• owner's equity

Asset accounts normally have _______ balances.

• debit

• credit

• no balance

• none of the above

Which of the following is an intangible asset?

• copyrights

• patents

• trademark

• all of the above

The following can be found in an income statement except

• assets

• expenses

• income

• profit or loss

In the accounting equation, an increase in asset can be associated with

• a decrease in a liability

• a decrease in owner's equity

• an increase in a liability

• an increase in another asset

The components of the balance sheet equation are

• assets, income and owner's equity

• assets, liabilities and owner's equity

• income, expenses and profit

• investments, withdrawals and profit

All of the following affect the owner's equity account except

• additional investment

• original investment

• payment of a liability

• withdrawal by the owner

A current asset which includes coins, currencies and bank deposits is called

• accounts receivable

• cash

• cash equivalents

• notes receivable

If an owner invests her laptop computer and printer in the business, there is an increase to

• Cash and Capital

• Cash and Withdrawals

• Computer Equipment and Cash

• Computer Equipment and Capital

The expectation of a future payment from a customer for goods sold is

• a notes receivable

• a prepaid expense

• an accounts receivable

• all of the above