Question

Cash, $2,000 Accounts Receivable, $1,250 Professional Equipment, $10,200 Office Equipment, $5,500 Accounts Payable, $3,500 P. Palmer,...

Cash, $2,000
Accounts Receivable, $1,250
Professional Equipment, $10,200
Office Equipment, $5,500
Accounts Payable, $3,500
P. Palmer, Capital, $10,000
P. Palmer, Drawing, $1,000
Professional fee earned, $18,000
Rent Expense, $12,350
Wage Expense, $1,200
1. What is the amount of assets in the accounting equation?

2 The amounts that the business entity owes its creditors are referred to as

a.liabilities.

b.expenses.

c.owner's equity.

d.revenues.

e.assets.

3 The purchase of supplies for cash will

a.increase Supplies Expense and increase Accounts Payable.

b.decrease Cash and increase Accounts Payable.

c.increase Supplies and decrease Cash.

d.decrease Cash and increase Capital.

e.increase Supplies Expense and decrease Cash.

4

The account ____________ is used to record amounts due from charge customers.

a.cash

b.accounts receivable

c.revenue

d.accounts payable

5

A one-owner business is called a

a.partnership.

b.sole-ownership.

c.sole-proprietorship.

d.corporation.

6

Prepaid Insurance is a(n)

a.asset.

b.revenue.

c.expense.

d.liability.

7

Expenses are recorded

a.in advance or when they are due.

b.when they are paid.

c.when they are incurred.

d.None of these listed answers are correct.

Business   Accounting   
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Homework Answers

Answer #1

1) Asset = Cash + Accounts Receivable + Professional Equipment + Office Equipment

= $2,000 + $1,250 + $10,200 + $5,500

= $18,950

2) Liabilities are the amounts that the business entity owes its creditors.

OPTION A

3) The purchase of supplies for cash will increase Supplies and decrease Cash.

OPTION C

4) Accounts receivable is used to record amounts due from charge customers.

OPTION B

5) A one-owner business is called sole-proprietorship.

OPTION C

6) Prepaid Insurance is an Asset.

OPTION A

7) Expenses are recorded when they are incurred.

OPTION C

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