11) Cash and accounts receivable are both a part of:
B) retained earnings.
D) common shares.
E) preferred shares
12) Brandon borrowed money for his business from a local bank. What accounts will be affected?
A) Cash and accounts payable
B) Cash and notes payable
C) Accounts payable and revenue
D) Accounts receivable and revenue
E) Cash and accounts receivable
13) If total assets remain the same and total shareholders' equity increases, liabilities will:
A) increase by the same amount.
B) decrease by the same amount.
C) remain the same.
D) increase by a different amount.
E) decrease by a different amount.
14) Which of the following is a true statement?
A) Purchasing office equipment for cash is a shift of assets.
B) Buying something on account decreases total liabilities.
C) Retained earnings do not include payments of dividends.
D) Paying off an account increases the total of assets.
E) Selling something on account increases total liabilities.
15) Jenny opens her business by investing $12,000. How does this affect the accounting equation?
A) Increase in assets; increase in shareholders' equity.
B) Increase in liabilities; increase in shareholders' equity.
C) Decrease in assets; increase in shareholders' equity.
D) Increase in assets; decrease in shareholders' equity.
E) The accounting equation does not change.
16) A company purchases merchandise (inventory) for cash. What is the net result on the accounting equation?
17) Monies the company will pay at a later date are classified as __________.
18) Cash, supplies, and equipment are all part of __________.
19) Monies owed to a company by customers are classified as __________.
20) Items such as revenue, expenses, and dividends are classified in the accounting equation as __________.