chapter 2

Created by munderwood 

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The accounting process begins with:

analysis of business transactions and source documents

Unearned revenues are:

Liabilities created when a customer pays in advance for products or services before the revenue is earned.

The process of transferring general journal information to the ledger is:

Posting.

A record in which the effects of transactions are first recorded and from which transaction amounts are posted to the ledger is a:

Journal.

A report that lists accounts and their balances, in which the total debit balances should equal the total credit balances, is called a:

Trial balance

Accounts receivable:

are increased by credit
decreased by debit

Accounts payable is a ________ account

liability

Equity accounts are:

1. owner's capital
2. Owner's withdrawals
3. Revenues
4. Expenses

on a T chart for assets, ______ for increases, and ______ for decreases.

Debit, Credit

On a T chart for Liabilities, _______ decreases, and ______ increases.

Debit, credit

On a T chart for Equity, _________ decreases, and ________increases.

Debit and Credit

owner's capital has a normal balance of:

Credit

Owner withdrawals has a normal balance of:

Debit

Revenues have a normal balance of:

Credit

Expenses have a normal balance of:

Debit

Service fees earned appear on the:

Income statement

Cash withdrawal by owner appears on the:

Statement of owner's equity

Office supplies is on the:

Balance Sheet

Cash is on the:

Balance Sheet

Prepaid Rent is on the:

income statement

A-assets
W-withdrawals
E-Equity

have debit normal balances

L-Liabilities
C-Capital
R-Revenues

have credit normal balances

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