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True or False 1. A transaction with more than one debit and/or more than one credit is called a compound entry 2. An increase in an asset is recorded by a deblt 3. The ledger s a chronological record of all transactions

True or False 1. A transaction with more than one debit and/or more than one credit is called a compound entry 2. An increase in an asset is recorded by a deblt 3. The ledger s a chronological record of all transactions

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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16. The double-entry system is possible because all business transactions have two equal and opposite aspects. NAME: SCORE: SECTION: PROFESSOR: 17. A decrease owner's equity is recorded with a credit True or False 18. When the owner makes an investment, the owner's Capital account is debited. 1. A transaction with more than one debit and/or more than one credit is called a compound entry Notos receivable are claims against debtors ovidenced by a written promise to pay a certain sum of money at a definite time to the order of a specified person or to 19. 2. An increase in an asset is recorded by a deblt bearer 3 The ledger is a chronological record of all transactions 20. Liabilities are established with debits and eliminated with credits. 4. When payment is recelved for services not yet rendered, no entry is recorded until that service has been rendered 21. When a withdrawal is made, the owner's Withdrawals account is debited and Cash Is credited 5. When revenue has been earned, no entry is recorded until the related cash has 22. When a company hires a new employee, a recordable event has occurred. been collected. 23. When the columns of the trial balance ore equal, no errors have occurred in recording and posting the transactlos 6 Recording 4,125 as 41 2500 s an example of a transposition 24 It is sometimos correct fer a compound entry's debit totals and credit totals to be unequal 7. Unearned rgvenues arg classified as assets on the balance sheet Investments by the owner are recorded In the owner's Capital account, not in a revenue account. 8. The Land account and the Building account may be combined into one acCount 9. A debit means that an account has been increased. 20. The normal balance of any account refers to the side of the account-debit or credit-where decreases are recorded 10. A credit has an unfavorable effect on an account. 27. Entering transactions into the journal is called posting 11 Another name for the journal is the book of original entry 28. Cost is the exchange price associated with a business transaction at the time the transaction is recognired 12 An increase in a liability is recorded by a debit 13 An increase in revenue is recorded with a credit 79. In a trial balance, all debits are listed before all credits 14. If equipment is bought by paying P20,000 ós a down payment and the remaining P40,000 in 30 days, total liabilities are increased by P20,00. 30. The double-entry syttem means that transactions are recorded both in the journal and in the ledger. 15 A credit signifies increases in llabilities, capital, and revenues, and decreases in assets, withdrawals, and expenses 4-21
Transcribed Image Text:16. The double-entry system is possible because all business transactions have two equal and opposite aspects. NAME: SCORE: SECTION: PROFESSOR: 17. A decrease owner's equity is recorded with a credit True or False 18. When the owner makes an investment, the owner's Capital account is debited. 1. A transaction with more than one debit and/or more than one credit is called a compound entry Notos receivable are claims against debtors ovidenced by a written promise to pay a certain sum of money at a definite time to the order of a specified person or to 19. 2. An increase in an asset is recorded by a deblt bearer 3 The ledger is a chronological record of all transactions 20. Liabilities are established with debits and eliminated with credits. 4. When payment is recelved for services not yet rendered, no entry is recorded until that service has been rendered 21. When a withdrawal is made, the owner's Withdrawals account is debited and Cash Is credited 5. When revenue has been earned, no entry is recorded until the related cash has 22. When a company hires a new employee, a recordable event has occurred. been collected. 23. When the columns of the trial balance ore equal, no errors have occurred in recording and posting the transactlos 6 Recording 4,125 as 41 2500 s an example of a transposition 24 It is sometimos correct fer a compound entry's debit totals and credit totals to be unequal 7. Unearned rgvenues arg classified as assets on the balance sheet Investments by the owner are recorded In the owner's Capital account, not in a revenue account. 8. The Land account and the Building account may be combined into one acCount 9. A debit means that an account has been increased. 20. The normal balance of any account refers to the side of the account-debit or credit-where decreases are recorded 10. A credit has an unfavorable effect on an account. 27. Entering transactions into the journal is called posting 11 Another name for the journal is the book of original entry 28. Cost is the exchange price associated with a business transaction at the time the transaction is recognired 12 An increase in a liability is recorded by a debit 13 An increase in revenue is recorded with a credit 79. In a trial balance, all debits are listed before all credits 14. If equipment is bought by paying P20,000 ós a down payment and the remaining P40,000 in 30 days, total liabilities are increased by P20,00. 30. The double-entry syttem means that transactions are recorded both in the journal and in the ledger. 15 A credit signifies increases in llabilities, capital, and revenues, and decreases in assets, withdrawals, and expenses 4-21
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