The effects on the basic accounting equation of performing services for cash are to:
increase assets and increase stockholders' equity.
Genesis Company buys a $900 machine on credit. This transaction will affect the:
balance sheet only.
Which of the following events is not recorded in the accounting records?
An employee is terminated.
During 2010, Gibson Company assets decreased $50,000 and its liabilities decreased $90,000. Its stockholders' equity therefore:
increased $40,000.
Which statement about an account is true?
An account is an individual accounting record of increases and decreases in specific asset, liability, and stockholders' equity items.
Debits:
increase assets and decrease liabilities.
A revenue account:
is increased by credits.
Which accounts normally have debit balances?
Assets, dividends, and expenses.
Paying an account payable with cash affects the components of the accounting equation in the following way.
Decreases assets and decreases liabilities.
Which is not part of the recording process?
Preparing a trial balance.
Which of these statements about a journal is false?
It contains only revenue and expense accounts.
A ledger:
is a collection of the entire group of accounts maintained by a company.
Posting:
transfers journal entries to ledger accounts.
A trial balance:
is a list of accounts with their balances at a given time.
A trial balance will not balance if:
a $100 cash dividend is debited to Dividends for $1,000 and credited to Cash for $100.