WorksheetsBasic Accounting Equation Quiz
Total questions: 30
Worksheet time: 28mins
What is the basic accounting equation?
LIABILITIES = ASSETS + EQUITY
EQUITY = ASSETS - LIABILITIES
ASSETS = EQUITY - LIABILITIES
ASSETS = LIABILITIES + EQUITY
In a sole proprietorship, what is equity referred to as?
Partner's Equity
Investor's Equity
Stockholder's Equity
Owner's Equity
What happens to the accounting equation when a business purchases equipment for cash?
Assets remain the same, equity remains the same
Assets increase, liabilities decrease
Assets remain the same, equity decreases
Assets remain the same, liabilities increase
What is the effect on the accounting equation when supplies are purchased on account?
Assets decrease, equity decreases
Assets increase, equity increases
Assets increase, liabilities increase
Assets decrease, liabilities decrease
What is the result of making a payment to a creditor?
Assets decrease, equity increases
Assets decrease, liabilities decrease
Assets increase, equity decreases
Assets increase, liabilities increase
How is prepaid rent recorded in the accounting equation?
Increase in liabilities
Decrease in equity
Increase in assets
Decrease in assets
What happens when services are sold for cash?
Assets decrease, equity decreases
Assets increase, equity increases
Assets decrease, liabilities decrease
Assets increase, liabilities increase
How is selling services on credit recorded?
Increase in liabilities
Increase in assets
Decrease in equity
Decrease in assets
What is the effect of collecting accounts receivable?
Assets decrease, equity decreases
Assets remain the same, equity increases
Assets remain the same, liabilities remain the same
Assets increase, liabilities decrease
What is the impact of paying a utility bill on the accounting equation?
Assets decrease, expenses increase
Assets increase, liabilities decrease
Assets increase, equity decreases
Assets decrease, equity increases
What is the effect on the accounting equation when a business receives cash from a bank loan?
Assets remain the same, equity remains the same
Assets decrease, liabilities decrease
Assets increase, equity increases
Assets increase, liabilities increase
How is the purchase of inventory on credit recorded in the accounting equation?
Assets increase, liabilities increase
Assets decrease, liabilities decrease
Assets decrease, equity decreases
Assets increase, equity increases
What happens to the accounting equation when a business pays dividends to its shareholders?
Assets decrease, equity decreases
Assets increase, equity decreases
Assets increase, liabilities increase
Assets remain the same, equity increases
Accounts payable is a (a)
The Accounting Equation
(a) = (b) + (c)
If Assets are $7,300 and Liabilities are $500, how much is Capital?
$7,800
$7,300
$6,800
If Capital is $31,400 and Liabilities are $15,500, how much are Assets?
$46,900
$15,500
$15,900
If Assets are $19,500 and Capital is $14,300, how much are Liabilities?
33,800
$5,200
$19,500
If Assets are $40,000 and Liabilities are $23,000, how much is Capital?
$63,000
$17,000
$23,000
If the assets of a business ss are ₹100,000 and equity is ₹20,000, the value of liability will be
₹1,00,000
₹80,000
₹ 1,20,000
₹20,000
Find the missing amount:
Assets =
Liabilities = -10
Owner Equity = 90
(a)
What is the accounting equation?
assets = liabilities + depreciation
liabilities = assets + depreciation
assets = liabilities + owner's equity
liabilities = assets + owner's equity
On January 1st 2009 an entity"s balance sheet showed total asset of ₹850 and total liabilities of ₹250. Owners equity at January 1st was?
850
250
1100
600
What is the accounting equation?
A + L = OE
A - L = OE
A = L + OE
A = L - OE
If Capital is $30,000 and Liabilities are $15,000, how much are Assets?
$45,000
$15,000
$25,000
If Assets are $7,300 and Liabilities are $500, how much is Capital?
$7,800
$7,300
$6,800
$500
Net income is calculated as Revenue – Expenses and is added to ( ).
(a)
Metro Courier, Inc., was organized as a corporation on January 1, the company issued shares (10,000 shares at $3 each) of common stock for $( ) cash to Ron Chaney, his wife, and their son. The $30,000 cash was deposited in the new business account.
(a)
Metro paid $ 5,500 cash for equipment (two computers).
Transaction analysis:
The new corporation purchased new asset (equipment) for $5,500 and paid cash.
We want to ( ) the asset Equipment and decrease the asset Cash since we paid cash.
(a)
Metro paid $ 8,500 cash for a truck.
Transaction analysis:
The new corporation purchased new asset (truck) for $8,500 and paid cash.
We want to increase the asset Truck and ( ) the asset cash for $8,500.
(a)
