Fundamentals of Accounting and Double-
Entry System UPDATED ACTUAL
QUESTIONS AND CORRECT ANSWERS
Accounts - Correct answers✔✔Basic building blocks of financial accounting systems.
Accounting Equation - Correct answers✔✔Assets = Liabilities + Owner's Equity.
Debits - Correct answers✔✔Entries that increase assets or decrease liabilities.
Credits - Correct answers✔✔Entries that decrease assets or increase liabilities.
Normal Account Balance - Correct answers✔✔Typical balance expected for an account type.
Double-Entry Accounting - Correct answers✔✔System where every transaction affects two
accounts.
T-Accounts - Correct answers✔✔Visual representation of debits and credits.
Journal Entries - Correct answers✔✔Initial recording of transactions in accounting.
Ledger - Correct answers✔✔Repository where accounts are grouped and maintained.
Trial Balance - Correct answers✔✔Summary of all account balances at a point.
, Assets - Correct answers✔✔Economic resources benefiting future business operations.
Liabilities - Correct answers✔✔Obligations to sacrifice economic benefits in future.
Owner's Equity - Correct answers✔✔Owner's claim to the business assets.
Revenues - Correct answers✔✔Increases in owner's equity from economic events.
Expenses - Correct answers✔✔Decreases in owner's equity from operational events.
Capital - Correct answers✔✔Owner's investment in the business.
Reserves - Correct answers✔✔Retained earnings set aside for specific purposes.
Accounts Receivable - Correct answers✔✔Money owed to the business by customers.
Accounts Payable - Correct answers✔✔Money the business owes to suppliers.
Unearned Revenue - Correct answers✔✔Payments received before services are performed.
Economic Events - Correct answers✔✔Transactions affecting financial state of an entity.
Debit Side - Correct answers✔✔Left-hand side of an account for increases.
Entry System UPDATED ACTUAL
QUESTIONS AND CORRECT ANSWERS
Accounts - Correct answers✔✔Basic building blocks of financial accounting systems.
Accounting Equation - Correct answers✔✔Assets = Liabilities + Owner's Equity.
Debits - Correct answers✔✔Entries that increase assets or decrease liabilities.
Credits - Correct answers✔✔Entries that decrease assets or increase liabilities.
Normal Account Balance - Correct answers✔✔Typical balance expected for an account type.
Double-Entry Accounting - Correct answers✔✔System where every transaction affects two
accounts.
T-Accounts - Correct answers✔✔Visual representation of debits and credits.
Journal Entries - Correct answers✔✔Initial recording of transactions in accounting.
Ledger - Correct answers✔✔Repository where accounts are grouped and maintained.
Trial Balance - Correct answers✔✔Summary of all account balances at a point.
, Assets - Correct answers✔✔Economic resources benefiting future business operations.
Liabilities - Correct answers✔✔Obligations to sacrifice economic benefits in future.
Owner's Equity - Correct answers✔✔Owner's claim to the business assets.
Revenues - Correct answers✔✔Increases in owner's equity from economic events.
Expenses - Correct answers✔✔Decreases in owner's equity from operational events.
Capital - Correct answers✔✔Owner's investment in the business.
Reserves - Correct answers✔✔Retained earnings set aside for specific purposes.
Accounts Receivable - Correct answers✔✔Money owed to the business by customers.
Accounts Payable - Correct answers✔✔Money the business owes to suppliers.
Unearned Revenue - Correct answers✔✔Payments received before services are performed.
Economic Events - Correct answers✔✔Transactions affecting financial state of an entity.
Debit Side - Correct answers✔✔Left-hand side of an account for increases.
