Test Bank Century 21 Accounting General Journal 11th Edition By Claudia Bienias Gilbertson, Mark Lehman

Test Bank for Century 21
Accounting General Journal
11th Edition By Claudia
Bienias Gilbertson, Mark
Lehman (All Chapters 1-24,
100% Original Verified, A+
Grade)
This is The Only Original and
Complete Test Bank for 11th
Edition, All Other Files in the
Market are Fake/Old/Wrong
Edition.

,Name: Class: Date:

Chapter 01—The Accounting Equation

Indicate whether the statement is true or false.
1. The accounting equation is most often stated as Assets + Liabilities = Owner’s Equity.
a. True
b. False

ANSWER: False
POINTS: 1
DIFFICULTY: Remember/Understand

2. After each transaction, the accounting equation must remain in balance.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

3. A negative amount for net worth would reflect more debt than assets, something a creditor would favor.
a. True
b. False

ANSWER: False
POINTS: 1
DIFFICULTY: Remember/Understand

4. When two asset accounts are changed in a transaction, there must be an increase and a decrease.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

5. Detailed information about changes in owner’s equity is needed by owners and managers to make sound
business decisions.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand




Powered by Cognero Page 1

,Name: Class: Date:

Chapter 01—The Accounting Equation

6. When items are bought and paid for at a future date, another way to state this is to say these items are bought on
account.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

7. A transaction for the sale of goods or services results in a decrease in owner’s equity.
a. True
b. False

ANSWER: False
POINTS: 1
DIFFICULTY: Remember/Understand

8. Keeping separate the financial records for a business and for its owner’s personal belongings is an application of
the Business Entity accounting concept.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

9. An expense is a decrease in owner’s equity resulting from the operation of a business.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

10. Business ethics are the principles of right and wrong that guide an individual in making decisions.
a. True
b. False

ANSWER: False
POINTS: 1
DIFFICULTY: Remember/Understand




Powered by Cognero Page 2

, Name: Class: Date:

Chapter 01—The Accounting Equation

11. Payments for advertising, equipment repairs, utilities, and rent are liabilities.
a. True
b. False

ANSWER: False
POINTS: 1
DIFFICULTY: Remember/Understand

12. Withdrawals are assets taken out of a business for the owner’s personal use.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

13. The most common type of withdrawal by an owner from a business is the withdrawal of cash.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

14. When an owner withdraws cash from the business, the transaction affects both assets and owner’s equity.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Remember/Understand

15. A withdrawal is an expense.
a. True
b. False

ANSWER: False
POINTS: 1
DIFFICULTY: Remember/Understand

Directions: Select the one term that best fits each definition. Print the letter identifying your choice on the
line to the left of the statement.
a. account
b. account balance
c. account title

Powered by Cognero Page 3