Bookkeeping (Quiz #1) with complete
solutions
List as many assets as you can - Answer -A/R, cash, savings, building/land, equipment,
supplies.
List as many liabilities as you can - Answer -A/P, mortgage payable, bank loan, credit
card payable.
What is the accounting equation? - Answer -ALOE. A=L+OE
What is the acronym for the rules of accounting that govern the bookkeeping system? -
Answer -GAAP. (Generally accepted accounting principles)
What financial statement shows assets, liabilities, and owners equity? - Answer -
Balance sheet
Does the drawings account increase owners equity or decrease it? - Answer -Decrease
What two main categories are recorded on the income statement? - Answer -Revenue
and expense
If a business makes a sale but doesn't get paid cash, which accounts change? - Answer
-Accounts receivable and revenue
What is the accounting period? - Answer -Can be any time covered by financial
statement
What is the first figure on the statement of owners equity? - Answer -Beginning capital
balance
How would you arrive at net income? - Answer -Subtract expenses from revenue
When an owner withdraws cash for personal use do his assets increase or decrease? -
Answer -Decrease
When you incur an expense, does it mean that you have paid cash for it? - Answer -No
solutions
List as many assets as you can - Answer -A/R, cash, savings, building/land, equipment,
supplies.
List as many liabilities as you can - Answer -A/P, mortgage payable, bank loan, credit
card payable.
What is the accounting equation? - Answer -ALOE. A=L+OE
What is the acronym for the rules of accounting that govern the bookkeeping system? -
Answer -GAAP. (Generally accepted accounting principles)
What financial statement shows assets, liabilities, and owners equity? - Answer -
Balance sheet
Does the drawings account increase owners equity or decrease it? - Answer -Decrease
What two main categories are recorded on the income statement? - Answer -Revenue
and expense
If a business makes a sale but doesn't get paid cash, which accounts change? - Answer
-Accounts receivable and revenue
What is the accounting period? - Answer -Can be any time covered by financial
statement
What is the first figure on the statement of owners equity? - Answer -Beginning capital
balance
How would you arrive at net income? - Answer -Subtract expenses from revenue
When an owner withdraws cash for personal use do his assets increase or decrease? -
Answer -Decrease
When you incur an expense, does it mean that you have paid cash for it? - Answer -No
