Week 4

Equity = Assets - Liabilities

• True

• False

Owner’s contributions are when an owner of the business invests personal assets into the business.

• True

• False

Cash can be received ONLY after a service has been performed.

• True

• False

An account receivable is when you must collect money from your clients.

• True

• False

• Celine Dion

• Justin Bieber

Unearned revenue is a liability account on the balance sheet.

• True

• False

An account payable is a current asset on the balance sheet.

• True

• False

What is the entry to record an expense if a company pays before the expense is incurred?

• Decrease cash, increase prepaid expenses

• Increase cash, increase prepaid expenses

• Increase cash, increase the specific expense account

• Decrease cash, increase the specific expense account

A businesses most liquid asset is cash

• True

• False

Salaries and wages are an expense

• True

• False