Hamilton Lawn Services incurred $800 as a repair expense and paid for it in cash. This transaction will ________. A) decrease the stockholders’ equity B) increase the assets of the business C) increase the liabilities of the business D) decrease the liabilities of the business ANSWER A
Date: September 2nd, 2020
Harris Landscaping Services incurred $500 as a labor expense and promised to pay the labor agency within 30 days. Which of the following accounts will increase as a result of this transaction? A) Accounts Receivable B) Cash C) Accounts Payable D) Retained Earnings ANSWER C
Date: September 2nd, 2020
________ is the equity earned by profitable operations that is not distributed to stockholders. A) Assets B) Dividend C) Retained earnings D) Common stock ANSWER C
Date: September 2nd, 2020
Wallace Repair Corporation incurred $1,500 as a labor expense and promised to pay the labor agency within 30 days. Which of the following will decrease as a result of this transaction? A) Assets B) Stockholders’ equity C) Liabilities D) Revenues ANSWER B
Date: September 2nd, 2020
Which of the following is true of retained earnings? A) Retained earnings decrease with payment of dividends. B) Retained earnings increase with purchase of assets. C) Retained earnings decrease with collection of revenue. D) Retained earnings increase with payment on account. ANSWER A
Date: September 2nd, 2020
Marsh Supply Services paid $350 cash to a materials supplier, the amount owed from the previous month. Which of the following accounts decreases? A) Accounts Receivable B) Accounts Payable C) Retained Earnings D) Office Supplies ANSWER B
Date: September 2nd, 2020
Equity of a corporation is broken out into two components. Which of the following are the two components of the equity of a corporation? A) current assets and fixed assets B) common stock and liabilities C) revenues and expenses D) contributed capital and retained earnings ANSWER D
Date: September 2nd, 2020
A transaction is any event that affects the financial position of the business and can be easily estimated. Indicate whether the statement is true or false ANSWER FALSE .A transaction is any event that affects the financial position of the business and can be measured reliably.
Date: September 2nd, 2020
John contributed $6,000 to the business by opening a bank account in the name of the business, United Internists. The corporation issued common stock to John. This transaction results in an increase in the assets of the business. Indicate whether the statement is true or false ANSWER TRUE
Date: September 2nd, 2020
For an accounting equation to balance, a transaction must affect both sides of the equation. Indicate whether the statement is true or false ANSWER FALSE
Date: September 2nd, 2020
