Quiz 1

Accounting is an information and measurement system that identifies, records, and communicates an organization's business activities.

• True

• False

Recordkeeping, or bookkeeping, is the recording of transactions and events, either manually or electronically. This is just one part of accounting.

• True

• False

Liabilities are the owner's claim on assets.

• True

• False

Assets are present economic resources controlled by the entity as a result of past events and expected to yield future benefits.

• True

• False

The accounting equation implies that: Assets + Liabilities = Equity.

• True

• False

An account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item.

• True

• False

Withdrawals by the owner are a business expense.

• True

• False

The purchase of land and buildings will generally be recorded in the same ledger account.

• True

• False

An account's balance is the difference between the total debits and total credits for the account, including any beginning balance.

• True

• False

Credits always increase account balances.

• True

• False