WorksheetsTOPIC 2 BASIC ACCOUNTING CONCEPTS
Total questions: 10
Worksheet time: 3mins
Liabilities
are future economic benefits.
are existing debts and obligations.
possess service potential.
are things of value used by the business in its operation.
Owner's equity can be described as
creditorship claim on total assets
ownership claim on total assets
benefactor's claim on total assets.
debtor claim on total assets
When an owner withdraws cash or other assets from a business for personal use, these withdrawals are termed
depletions.
consumptions.
drawings.
a credit line.
Capital is
an owner's permanent investment in the business.
equal to liabilities minus owner's equity.
equal to assets minus owner's equity.
equal to liabilities plus drawings
Revenues would not result from
sale of merchandise
initial investment of cash by owner.
performance of services.
rental of property.
Sources of increases to owner's equity are
additional investments by owners.
purchases of merchandise.
withdrawals by the owner.
expenses.
Owner's equity is decreased by all of the following except
owner's investments.
owner's withdrawals.
expenses.
owner's drawings
A net loss will result during a time period when
liabilities exceed assets.
drawings exceed investments.
expenses exceed revenues.
revenues exceed expenses
If total liabilities decreased by $40,000 and owner’s equity increased by $30,000 during a period of time, then total assets must change by what amount and direction during that same period?
$50,000 decrease
$10,000 decrease
$10,000 increase
$50,000 increase
If total liabilities decreased by $40,000 and owner’s equity decreased by $30,000 during a period of time, then total assets must change by what amount and direction during that same period?
$70,000 decrease
$10,000 decrease
$10,000 increase
$70,000 increase
