Accounting Equation 2 11-20

The favorable balance of profit and loss account should be?

Subtracted from liabilities

Added in liabilities

Added in capital

Subtracted from current assets

Correct! Wrong!

Which of the following accounts will be used in equation, if the goods are sold on credit to Mr. Mahmood?

Account Payable and Owner’s Equity

Account Receivable and Owner’s equity

Cash account and Owner’s equity

Cash and Account Receivable

Correct! Wrong!

Mr. “A” borrowed money from bank; this transaction involves which one of the following accounts?

Drawing & Cash

Bank & Debtors

Cash & Bank Loan

Cash & Bank

Correct! Wrong!

Which one of the following represents the expanded basic accounting equation?

Assets + Dividends - Expenses = Liabilities + Common Shares + Revenues

Assets = Liabilities + Common Shares + Dividends – Revenue – Expenses

Assets – Liabilities – Dividends = Common Shares + Revenues – Expenses

Assets = Revenues + Expenses – Liabilities

Correct! Wrong!

Revenue of the business includes?

Both cash sales and credit sales

Credit sales only

Cash sales only

Credit purchases only

Correct! Wrong!

Which of the following is not a satisfactory statement of the balance sheet equation?

Assets - liabilities = owner’s equity

Assets = liabilities - owner’s equity

Assets - owner’s equity = liabilities

Assets = liabilities + owner’s equity

Correct! Wrong!

The liabilities of a business are Rs. 30,000; the capital of the proprietor is Rs. 70,000. The total assets are?

Rs. 30,000

Rs.40,000

None of given options

Rs.70,000

Correct! Wrong!

Which of the following account is affected from the drawings of cash in sole-proprietorship business?

Expense account

Shareholder account

Liability account

Capital account

Correct! Wrong!

Which of the following transactions would have no impact on stockholders' equity?

Purchase of land on credit

Dividends to stockholders

Net loss

Investment in cash by stockholders

Correct! Wrong!

Mr. A provided the following information from his books of accounts at the end of the month. What is the amount of his capital?

Rs. 1,300

Rs. 900

Rs. 1,200

Rs. 200

Correct! Wrong!

The favorable balance of profit and loss account should be?

Which of the following accounts will be used in equation, if the goods are sold on credit to Mr. Mahmood?

Mr. “A” borrowed money from bank; this transaction involves which one of the following accounts?

Which one of the following represents the expanded basic accounting equation?

Revenue of the business includes?

Which of the following is not a satisfactory statement of the balance sheet equation?

The liabilities of a business are Rs. 30,000; the capital of the proprietor is Rs. 70,000. The total assets are?

Which of the following account is affected from the drawings of cash in sole-proprietorship business?

Which of the following transactions would have no impact on stockholders' equity?

Mr. A provided the following information from his books of accounts at the end of the month. What is the amount of his capital?

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