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15-5 True or False Study Appendix 15B. Use T or F to indicate whether each of the following statements is true or false. For each false statement, explain why it is false. 1. Purchase of inventory on account should be credited to Inventory and debited to Accounts Payable. 2. Increases in asset accounts must always be entered on the right. 3. Increases in stockholders' equity should always be entered as credits. 4. Decreases in liability accounts should be recorded on the right. 5. Debit entries must always be recorded on the left. Credit entries can be recorded either on the right or on the left. 6. Money borrowed from the bank should be credited to Cash and debited to Notes Payable. 7. Decreases in accounts must be shown on the credit side. 8. Both increases in liabilities and decreases in assets should be entered on the right. 9. Asset credits should be entered on the right and liability credits on the left. 10. Payments on mortgages should be debited to Cash and credited to Mortgages Payable. Mortgages are liabilities.

15-5 True or False Study Appendix 15B. Use T or F to indicate whether each of the following statements is true or false. For each false statement, explain why it is false. 1. Purchase of inventory on account should be credited to Inventory and debited to Accounts Payable. 2. Increases in asset accounts must always be entered on the right. 3. Increases in stockholders' equity should always be entered as credits. 4. Decreases in liability accounts should be recorded on the right. 5. Debit entries must always be recorded on the left. Credit entries can be recorded either on the right or on the left. 6. Money borrowed from the bank should be credited to Cash and debited to Notes Payable. 7. Decreases in accounts must be shown on the credit side. 8. Both increases in liabilities and decreases in assets should be entered on the right. 9. Asset credits should be entered on the right and liability credits on the left. 10. Payments on mortgages should be debited to Cash and credited to Mortgages Payable. Mortgages are liabilities.

Accounting Information Systems
Accounting Information Systems
11th Edition
ISBN:9781337552127
Author:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill
Publisher:Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill
Chapter16: The General Ledger And Business Reporting (gl/br) Process
Section: Chapter Questions
Problem 4DQ
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15-5 True or False Study Appendix 15B. Use T or F to indicate whether each of the following statements is true or false. For each false statement, explain why it is false. 1. Purchase of inventory on account should be credited to Inventory and debited to Accounts Payable. 2. Increases in asset accounts must always be entered on the right. 3. Increases in stockholders' equity should always be entered as credits. 4. Decreases in liability accounts should be recorded on the right. 5. Debit entries must always be recorded on the left. Credit entries can be recorded either on the right or on the left. 6. Money borrowed from the bank should be credited to Cash and debited to Notes Payable. 7. Decreases in accounts must be shown on the credit side. 8. Both increases in liabilities and decreases in assets should be entered on the right. 9. Asset credits should be entered on the right and liability credits on the left. 10. Payments on mortgages should be debited to Cash and credited to Mortgages Payable. Mortgages are liabilities.
Transcribed Image Text:15-5 True or False Study Appendix 15B. Use T or F to indicate whether each of the following statements is true or false. For each false statement, explain why it is false. 1. Purchase of inventory on account should be credited to Inventory and debited to Accounts Payable. 2. Increases in asset accounts must always be entered on the right. 3. Increases in stockholders' equity should always be entered as credits. 4. Decreases in liability accounts should be recorded on the right. 5. Debit entries must always be recorded on the left. Credit entries can be recorded either on the right or on the left. 6. Money borrowed from the bank should be credited to Cash and debited to Notes Payable. 7. Decreases in accounts must be shown on the credit side. 8. Both increases in liabilities and decreases in assets should be entered on the right. 9. Asset credits should be entered on the right and liability credits on the left. 10. Payments on mortgages should be debited to Cash and credited to Mortgages Payable. Mortgages are liabilities.
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