AAMI ACCOUNTING 1 LATEST 2026 TEST PAPER
QUESTIONS AND SOLUTIONS RATED A+
✔✔The Revenue Account should have a _______ account balance. - ✔✔Credit
✔✔The term given to recording an entry when one debit and one credit are affected is
called: - ✔✔Double entry
✔✔This statement proves the equality of debits to credits: - ✔✔Trial Balance
✔✔Which of the following is an account payable: - ✔✔Mortgage Payable
✔✔Assets = Liabilities + Owner's Equity is: - ✔✔Basic Accounting Equation
✔✔This account should have a Debit balance associated with it: - ✔✔Expenses
✔✔An account balance is: - ✔✔the difference between an accounts debits and credits
✔✔Increases to the Cash Account are recorded as: - ✔✔Debits
✔✔From the following select the group whose accounts should have a Debit balance
associated with them: - ✔✔Cash, expenses and capital
✔✔Monies that you or your business owe to another are called: - ✔✔Account payables
✔✔When the Revenue Account is credited, that means: - ✔✔we increased revenue
✔✔The difference between an account's debits and credits is called: - ✔✔account
balance
✔✔True or False - Decreases in owner's equity caused by withdrawals are debited to a
Withdrawals account. - ✔✔True
✔✔Which of the following accounts is NOT a part of Owner's Equity: - ✔✔Cash
✔✔The cash account has a Debit Balance of $ 10,000.00 and a Credit Balance of $
4,000.00. The account balance is: - ✔✔$6,000.00 Dr.
✔✔The Cash Account should have a ____________account balance - ✔✔Debit
✔✔The left side of a standard T account is - ✔✔The Debit Side
, ✔✔True or False - Owner's Equity is comprised of Assets + Liabilities + Revenue -
Expenses - ✔✔False
✔✔Jennie Hoffmann invested $20,000.00 into her legal practice. Which accounts are
affected in this transaction? - ✔✔Cash and Capital
✔✔Jennie Hoffmann received a $5,500.00 check for legal services provided. Which
accounts are affected in this transaction? - ✔✔Cash and Revenue
✔✔True or False - Increases to revenue increase owner's equity, and increases to
expenses also increase owner's equity. - ✔✔False
✔✔Which of the following in not to be considered an asset? - ✔✔Accounts payable
✔✔Ms. Hoffmann paid $1,000.00 for July's rent. Which accounts are affected in this
transaction? - ✔✔Rent Expense and Cash
✔✔Mr. Funky decides he wants to buy a $125,000-new hearse. His business checking
account has only $50,000. He decides to take some of his personal money and writes a
check to Funky Funeral Home for $75,000. His deposit of this check is considered to be
a/an____________ . He then runs to Custom Coach Company, and buys the hearse.
The hearse is considered to be a/an __________ . He pays $75,000 in cash and
finances $50,000 with Custom Coach Finance Company. The $50,000 is considered to
be a/an __________ . On his way back to the funeral home, he decides to top off the
gas tank with fuel. The fuel purchase is considered to be a/an ____________ -
✔✔capital investment, asset, liability and expense
✔✔Ms. Hoffman goes to the post office and mails a statement to a client that has an
Account Receivable of $5,000. Which accounts are affected? - ✔✔Postage Expense
and Cash
✔✔Ms. Hoffmann withdrew $500.00 from her business account. Which accounts are
affected in this transaction? - ✔✔Withdrawal and Cash
✔✔Increases in expenses, ____________ owner's equity: - ✔✔Decrease
✔✔True or False - Regarding the following transaction: May 10, paid Joe R. Inc
2,000.00 for supplies that were purchased on May 6. The two accounts that are affected
are Revenue and Accounts Receivable. - ✔✔False
✔✔Folly family wants to return an urn (they have not yet filled) that they purchased from
Friendly Funeral Home. The returned urn (and decreased revenue) ___________
owner's equity. - ✔✔Decreases
QUESTIONS AND SOLUTIONS RATED A+
✔✔The Revenue Account should have a _______ account balance. - ✔✔Credit
✔✔The term given to recording an entry when one debit and one credit are affected is
called: - ✔✔Double entry
✔✔This statement proves the equality of debits to credits: - ✔✔Trial Balance
✔✔Which of the following is an account payable: - ✔✔Mortgage Payable
✔✔Assets = Liabilities + Owner's Equity is: - ✔✔Basic Accounting Equation
✔✔This account should have a Debit balance associated with it: - ✔✔Expenses
✔✔An account balance is: - ✔✔the difference between an accounts debits and credits
✔✔Increases to the Cash Account are recorded as: - ✔✔Debits
✔✔From the following select the group whose accounts should have a Debit balance
associated with them: - ✔✔Cash, expenses and capital
✔✔Monies that you or your business owe to another are called: - ✔✔Account payables
✔✔When the Revenue Account is credited, that means: - ✔✔we increased revenue
✔✔The difference between an account's debits and credits is called: - ✔✔account
balance
✔✔True or False - Decreases in owner's equity caused by withdrawals are debited to a
Withdrawals account. - ✔✔True
✔✔Which of the following accounts is NOT a part of Owner's Equity: - ✔✔Cash
✔✔The cash account has a Debit Balance of $ 10,000.00 and a Credit Balance of $
4,000.00. The account balance is: - ✔✔$6,000.00 Dr.
✔✔The Cash Account should have a ____________account balance - ✔✔Debit
✔✔The left side of a standard T account is - ✔✔The Debit Side
, ✔✔True or False - Owner's Equity is comprised of Assets + Liabilities + Revenue -
Expenses - ✔✔False
✔✔Jennie Hoffmann invested $20,000.00 into her legal practice. Which accounts are
affected in this transaction? - ✔✔Cash and Capital
✔✔Jennie Hoffmann received a $5,500.00 check for legal services provided. Which
accounts are affected in this transaction? - ✔✔Cash and Revenue
✔✔True or False - Increases to revenue increase owner's equity, and increases to
expenses also increase owner's equity. - ✔✔False
✔✔Which of the following in not to be considered an asset? - ✔✔Accounts payable
✔✔Ms. Hoffmann paid $1,000.00 for July's rent. Which accounts are affected in this
transaction? - ✔✔Rent Expense and Cash
✔✔Mr. Funky decides he wants to buy a $125,000-new hearse. His business checking
account has only $50,000. He decides to take some of his personal money and writes a
check to Funky Funeral Home for $75,000. His deposit of this check is considered to be
a/an____________ . He then runs to Custom Coach Company, and buys the hearse.
The hearse is considered to be a/an __________ . He pays $75,000 in cash and
finances $50,000 with Custom Coach Finance Company. The $50,000 is considered to
be a/an __________ . On his way back to the funeral home, he decides to top off the
gas tank with fuel. The fuel purchase is considered to be a/an ____________ -
✔✔capital investment, asset, liability and expense
✔✔Ms. Hoffman goes to the post office and mails a statement to a client that has an
Account Receivable of $5,000. Which accounts are affected? - ✔✔Postage Expense
and Cash
✔✔Ms. Hoffmann withdrew $500.00 from her business account. Which accounts are
affected in this transaction? - ✔✔Withdrawal and Cash
✔✔Increases in expenses, ____________ owner's equity: - ✔✔Decrease
✔✔True or False - Regarding the following transaction: May 10, paid Joe R. Inc
2,000.00 for supplies that were purchased on May 6. The two accounts that are affected
are Revenue and Accounts Receivable. - ✔✔False
✔✔Folly family wants to return an urn (they have not yet filled) that they purchased from
Friendly Funeral Home. The returned urn (and decreased revenue) ___________
owner's equity. - ✔✔Decreases
