Concept Assessment Ch. 4 Vocab
1) To find the Balance of the debit table, add up the _______ and subtract the _______. 2) To find the Balance of the Credit table, add up the _______ and subtract the _______. 3) The total sum of the DEBIT balances and the total sum of CREDIT balances must be _______.
1) add up the DEBIT and subtract the CREDIT. 2) add up the CREDIT and subtract the DEBIT. 3) Both balances must be the SAME.
A _______ is a list of all the accounts a business uses
Chart of Accounts
DEBIT or CREDIT? Normal Balance side of Abe Dunn, Capital
Credit
DEBIT or CREDIT? Normal Balance side of Accounts Payable
Credit
The _______ side is the right side of the T account
Credit
"Received on account" debits and credits what two accounts? DEBITS: CREDITS:
DEBITS: Cash in Bank CREDITS: Accounts Receivable
"Invested money" debits and credits what two accounts? DEBITS: CREDITS:
DEBITS: Cash in bank CREDITS: Capital
"Transferring equipment" debits and credits what two accounts? DEBITS: CREDITS:
DEBITS: Office Equipment CREDITS: Capital
DEBIT or CREDIT? Normal Balance side of Accounts Receivable
Debit
DEBIT or CREDIT? Normal Balance side of Cash in Bank
Debit
DEBIT or CREDIT? Normal Balance side of Computer Equipment
Debit
DEBIT or CREDIT? Normal Balance side of Office Equipment
Debit
The left side of the T account is the _______ side
Debit
_______ is the financial record keeping system in which each business transaction affects a least two accounts
Double Entry Accounting
TRUE/FALSE: "Debit" means the increase side of an account.
False
TRUE/FALSE: "Debit" means to increase an account balance.
False
TRUE/FALSE: A credit to a liability account decreases the account balance.
False
TRUE/FALSE: A debit to one asset account and a credit to another asset account will result in the basic accounting equation being out of balance.
False
TRUE/FALSE: Asset accounts are increased on the credit side
False
TRUE/FALSE: Credit means to decrease a liability.
False
TRUE/FALSE: Double-entry accounting is the recordkeeping system in which each business transaction affects at least one account.
False
TRUE/FALSE: Every business transaction affects at least two accounts that are on different sides of the basic accounting equation.
False
TRUE/FALSE: Liabilities are decreased on the credit side.
False
TRUE/FALSE: Liability and capital accounts are increased on the debit side.
False
TRUE/FALSE: The T account is an inefficient method for analyzing many business transactions
False
TRUE/FALSE: The left side of a T account is always the credit side.
False
TRUE/FALSE: The normal balance side of an owner's capital account is the debit side.
False
TRUE/FALSE: The right side of a T account is always the debit side.
False
(idk if this is on the test) Withdrawals decreases and increases what two accounts? INCREASES: DECREASES:
INCREASES: Cash in Bank DECREASES: Capital
Accounts are grouped together in a _______
Ledger
The _______ of an account is the same side used to increase the account
Normal Balance
A _______ is a tool used by accountants to analyze business transactions
T account
TRUE/FALSE: 0) Each account has a specific side that is its normal balance side
True
TRUE/FALSE: A credit is an amount entered on the right side of the T account.
True
TRUE/FALSE: Assets are increased on the debit side.
True
TRUE/FALSE: Capital is increased on the credit side.
True
TRUE/FALSE: Debits and credits are used to record increases and decreases in each account affected by a business transaction.
True
TRUE/FALSE: For every debit entry made in one account, a credit entry must be made in another account.
True
TRUE/FALSE: For every debit there must be an equal credit.
True
TRUE/FALSE: 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
TRUE/FALSE: The basic accounting equation may be expressed as A - L = OE
True
TRUE/FALSE: The normal balance side for an asset account is the debit side.
True
TRUE/FALSE: The normal balance side of an account is the same side that is used to record increases to the account.
True
TRUE/FALSE: When analyzing business transactions, you should ask yourself which accounts are affected.
True