AAMI Accounting 1 Final Review (Bus 311) Questions & Answers Already Passed!!

Account receivables are: - Answer-Assets Cash is considered to be: - Answer-Asset Which of the following is an example of a liability: - Answer-Accounts Payable True or False - The expanded accounting equation is: Assets = Liabilities + Owner's Equity - AnswerFalse Gross profit minus expenses equals: - Answer-Net Profit Which of the following is not factored into computing Owner's Equity in the expanded Accounting equation: - Answer-Owner's Equity = [Capital In - Withdrawals] + [Revenue - Expenses] Revenue after deducting costs of goods sold is called: - Answer-Gross Profit John Smith gives his business $10,000.00 from his own personal funds. Which of the following accounts does this transaction affect? - Answer-Capital True or False - The basic accounting equation is: Assets = Liabilities + Owner's Equity - Answer-True A firm has $15,000.00 in liabilities and $22,500.00 in assets. In order to compute the Basic Accounting Equation, what must Owner's Equity be? - Answer-$7,500 Another name for ownership is: - Answer-Equity John Smith takes $5,000.00 back from his business to repay himself some of the money he loaned to his business. Which account would be affected: - Answer-WithdrawalsThe costs of doing business are termed: - Answer-Liabilities True or False - Net Loss is defined as the amount remaining when revenue exceeds expenses. - Answer-False, that is net profit True or False - Expenses increase owner's equity. - Answer-False Which account below should NOT have a credit balance? - Answer-Expenses From the following select the group whose accounts should have a Credit balance associated with them: - Answer-liabilities, revenue and capital True or False - The abbreviation for debit is DT. - Answer-False The Revenue Account should have a _______ account balance. - Answer-Credit The term given to recording an entry when one debit and one credit are affected is called: - AnswerDouble entry This statement proves the equality of debits to credits: - Answer-Trial Balance Which of the following is an account payable: - Answer-Mortgage Payable Assets = Liabilities + Owner's Equity is: - Answer-Basic Accounting Equation This account should have a Debit balance associated with it: - Answer-Expenses