ACCY 200 Exam 1 UIUC questions with correct answers

The balance sheet equation can be represented by: Answer Assets = Liabilities + Stockholders' Equity. This accounting method accomplishes much of the matching of revenues and expenses? Answer Accrual accounting A fiscal year: Answer is frequently selected based on the firm's operating cycle Expenses are: Answer decreases in net assets resulting from usual operating activities The going concern concept refers to a presumption that: Answer the entity will continue to operate in the foreseeable future. A credit entry will: Answer increase a liability account. A debit entry will: Answer increase the balance of an expense account. The effect of an adjustment is: Answer to increase the accuracy of the financial statements. An expanded version of the accounting equation could be: Answer Assets = Liabilities + Paid-in Capital + Beginning Retained Earnings + Revenues - Expenses - Dividends