Question 1

Each asset account has a normal credit balance.

Accepted Answer

A) True 
 B)False

Question 2

Prepaid Insurance is decreased with a credit.

Accepted Answer

A) True 
 B)False

Question 3

Increases in expense accounts are recorded as debits because they decrease the owner's capital account.

Accepted Answer

A) True 
 B)False  True

Question 4

When a business pays cash on account, a liability account is

Accepted Answer

A)   increased by a debit.
B)   increased by a credit.
C)   decreased by a debit.
D)   decreased by a credit.

Question 5

The normal balance side of any revenue account is the

Accepted Answer

A)   debit side.
B)   credit side.
C)   left side.
D)   none of these.

Question 6

Each transaction changes the balances in at least two accounts.

Accepted Answer

A) True 
 B)False

Question 7

To summarize withdrawal information separately from the other records, owner withdrawal transactions are recorded in the owner's capital account.

Accepted Answer

A) True 
 B)False

Question 8

If an amount is recorded on the side of a T account opposite the normal balance side, the account balance is

Accepted Answer

A)   increased.
B)   decreased.
C)   unaffected.
D)   correct. B

Question 9

When cash is received from sales, the change in the owner's equity is usually recorded

Accepted Answer

A)   on the debit side.
B)   directly in the owner's capital account.
C)   as interest revenue.
D)   in a separate revenue account.

Question 10

The left side of an asset account is the credit side because asset accounts are on the left side of the accounting equation.

Accepted Answer

A) True 
 B)False

Question 11

Asset accounts decrease on the credit side.

Accepted Answer

A) True 
 B)False

Question 12

Decreases to liability accounts are recorded on the credit side.

Accepted Answer

A) True 
 B)False

Question 13

An amount recorded on the right side of a T account is a debit.

Accepted Answer

A) True 
 B)False

Question 14

When $1,500 cash is received on account,

Accepted Answer

A)   Sales is increased with a credit and Cash is increased with a credit.
B)   Accounts Receivable is increased with a debit and Cash is increased with a credit.
C)   Accounts Receivable is decreased with a credit and Cash is increased with a debit.
D)   Accounts Receivable is decreased with a debit and Cash is increased with a debit. C

Question 15

Each liability account has a normal debit balance.

Accepted Answer

A) True 
 B)False

Question 16

The normal balance side of an Accounts Receivable account is a debit.

Accepted Answer

A) True 
 B)False

Question 17

The normal balance side of a liability account is the

Accepted Answer

A)   debit side.
B)   credit side.
C)   decrease side.
D)   left side.

Question 18

A drawing account is increased by debits and decreased by credits.

Accepted Answer

A) True 
 B)False

Question 19

Utilities Expense is increased with a debit.

Accepted Answer

A) True 
 B)False

Question 20

When cash is paid for supplies, the Supplies account is increased by a credit.

Accepted Answer

A) True 
 B)False

Exam 2: Debit and Credit Parts

Each asset account has a normal credit balance.

Correct AnswerverifiedShow Answer

Prepaid Insurance is decreased with a credit.

Correct AnswerverifiedShow Answer

Increases in expense accounts are recorded as debits because they decrease the owner's capital account.

Correct AnswerverifiedTrue

When a business pays cash on account, a liability account is

Correct AnswerverifiedShow Answer

The normal balance side of any revenue account is the

Correct AnswerverifiedShow Answer

Each transaction changes the balances in at least two accounts.

Correct AnswerverifiedShow Answer

To summarize withdrawal information separately from the other records, owner withdrawal transactions are recorded in the owner's capital account.

Correct AnswerverifiedShow Answer

If an amount is recorded on the side of a T account opposite the normal balance side, the account balance is

Correct AnswerverifiedB

When cash is received from sales, the change in the owner's equity is usually recorded

Correct AnswerverifiedShow Answer

The left side of an asset account is the credit side because asset accounts are on the left side of the accounting equation.

Correct AnswerverifiedShow Answer

Asset accounts decrease on the credit side.

Correct AnswerverifiedShow Answer

Decreases to liability accounts are recorded on the credit side.

Correct AnswerverifiedShow Answer

An amount recorded on the right side of a T account is a debit.

Correct AnswerverifiedShow Answer

When $1,500 cash is received on account,

Correct AnswerverifiedC

Each liability account has a normal debit balance.

Correct AnswerverifiedShow Answer

The normal balance side of an Accounts Receivable account is a debit.

Correct AnswerverifiedShow Answer

The normal balance side of a liability account is the

Correct AnswerverifiedShow Answer

A drawing account is increased by debits and decreased by credits.

Correct AnswerverifiedShow Answer

Utilities Expense is increased with a debit.

Correct AnswerverifiedShow Answer

When cash is paid for supplies, the Supplies account is increased by a credit.

Correct AnswerverifiedShow Answer

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True

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B

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C

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