Accounting Equation Quiz

What are assets in accounting?

• The total amount of money invested in a business by its owners or shareholders

• Any amount that a business owes

• Anything of value that a business owns

• The amount of incoming money from a particular activity during the accounting period

What is a liability in accounting?

• Anything of value that a business owns

• Any amount that a business owes

• The total amount of money invested in a business by its owners or shareholders

• The amount of incoming money from a particular activity during the accounting period

What is equity in accounting?

• Anything of value that a business owns

• The amount of incoming money from a particular activity during the accounting period

• The total amount of money invested in a business by its owners or shareholders

• Any amount that a business owes

What is the basic formula for the accounting equation?

• Assets = Liabilities * Equity

• Assets = Liabilities - Equity

• Assets = Liabilities / Equity

• Assets = Liabilities + Equity

What is double-entry accounting?

• An accounting system in which every transaction is recorded as a separate entry into at least one account

• An accounting system in which every transaction is recorded as a separate entry into at least three accounts

• An accounting system in which every transaction is recorded as a separate entry into at least two accounts

• An accounting system in which every transaction is recorded as a separate entry into at least four accounts

What is an asset account in accounting?

• Charts the amount of incoming money from a particular activity during the accounting period

• Charts the amount of investments from the owner(s) or shareholders

• Charts the amount of a particular kind of liability that the business owes

• Charts the amount of a particular kind of asset that the business owns

What is a liability account in accounting?

• Charts the amount of a particular kind of asset that the business owns

• Charts the amount of investments from the owner(s) or shareholders

• Charts the amount of incoming money from a particular activity during the accounting period

• Charts the amount of a particular kind of liability that the business owes

What is a revenue account in accounting?

• Charts the amount of a particular kind of asset that the business owns

• Charts the amount of a particular kind of liability that the business owes

• Charts the amount of incoming money from a particular activity during the accounting period

• Charts the amount of outgoing money related to a particular activity during the accounting period

What is an expense account in accounting?

• Charts the amount of a particular kind of liability that the business owes

• Charts the amount of incoming money from a particular activity during the accounting period

• Charts the amount of outgoing money related to a particular activity during the accounting period

• Charts the amount of a particular kind of asset that the business owns

What is a debit in accounting?

• An entry that increases the balance of an asset or expense account and decreases the balance of a liability, revenue, or equity account

• An entry that decreases the balance of a liability, revenue, or equity account and increases the balance of an asset or expense account

• An entry that increases the balance of a liability, revenue, or equity account and decreases the balance of an asset or expense account

• An entry that decreases the balance of an asset or expense account and increases the balance of a liability, revenue, or equity account