FINANCIAL ACCOUNTING TEST 1 EXAM QUESTIONS WITH 100% COMPLETE AND CORRECT ANSWERS |A+ GRADE

FINANCIAL ACCOUNTING TEST 1
EXAM QUESTIONS WITH 100% COMPLETE AND CORRECT
ANSWERS |A+ GRADE
A business entity is an individual, association, or organization with control over economic
resources and which engages in economic activities.

- ✔True



Liabilities represent an "inside" interest in a business.

- ✔False



The accounting equation shows the relationship among the three basic accounting elements--
assets, revenues, and owner's equity.

- ✔False



If owner's equity and liabilities increased during the period, then assets must also have increased.

- ✔True



An accounts payable is an unwritten promise to pay a supplier for assets purchased or services
rendered.

- ✔True



If the revenue of a period exceeds the expenses, the excess represents a net loss.

- ✔False



Any accounting period of twelve months' duration is usually referred to as a calendar year.

- ✔False

, FINANCIAL ACCOUNTING TEST 1
EXAM QUESTIONS WITH 100% COMPLETE AND CORRECT
ANSWERS |A+ GRADE
Revenues received during an accounting period increase owner's equity.

- ✔True



Since supplies last for several months, they are recorded as assets.

- ✔True



Since insurance lasts for several months, it is recorded as owner's equity.

- ✔False



An increase or decrease in any asset, liability, owner's equity, revenue, or expense is always
accompanied by an offsetting change within the basic accounting elements.

- ✔True



A T account has three parts: the title, the debit side, and the credit side.

- ✔True



To debit an account is to enter an amount on the left side of the account.

- ✔True



Asset accounts normally have debit balances.

- ✔True