Chapter 2 True or False

"debit" means to increase an account balance

false

asset accounts are increased on the credit side

false

double-entry accounting is the recordkeeping system in which each business transaction affects at least one account

false

every business transaction affects at least two accounts that are on different sides of the basic accounting equation

false

liability and capital accounts are increased on the debit side

false

the T account is an inefficient method for analyzing many business transactions

false

the normal balance side of an owner's capital account is the debit side

false

Each account has a specific side that is its normal balance side

true

a credit is an amount entered on the right side of a T account

true

debits and credits are used to record increases and decreases in each account affected by a business transaction

true

for every debit entry made in one account, a credit entry must be made in another account

true

if the accounting equation is not in balance after a transaction has been recorded, one reason may be that the debit or credit part of the transaction was not recorded

true

the normal balance side of an account is the same side that is used to record increases to the account

true

when analyzing business transactions, you should ask yourself which accounts are affected

true