Accounting equation

Are you ready?

• Yes

• No

Which of the following equation best represent the accounting equation?

• A=OE-L

• A=L-OE

• A=OE+L

• OE= A+L

Capital is classified as a (an)

• Asset

• Owners equity

• Liability

• Expense

An owner took stock for personal use.

Identify the two accounts affected

• 1. Bank

  2. Drawings

• 1.Drawings

  2.Capital

• 1.Inventory

  2.Capital

• 1.Drawings

  2.Inventory

Assets increase on the credit side

• True
• False

Liabilities decrease on the debit side

• True
• False

Loan is best classified as a (an)

• Asset

• Long term

• Liability

• Expense

Interest on loan is best classified as a (an)

• Liability

• Owners equity

• Expense

• Assets

Which of the following is a current asset

• Vehicles

• Bank

• Land and Buildings

• Inventory

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