Accounting Equation Problems MCQs 2

If liabilities are $10,000 and equity is $25,000, assets are?

$25,000

$35,000

$15,000

$10,000

Correct! Wrong!

The effect of drawings on the accounting equation is?

Increase equity, decrease liabilities

Decrease assets, decrease equity

Increase assets, increase equity

Increase assets, decrease liabilities

Correct! Wrong!

Which transaction increases one asset and decreases another asset?

Receiving a loan

Purchasing equipment for cash

Owner investment

Paying salaries

Correct! Wrong!

Which element is missing? Assets = Liabilities + ____?

Revenue

Owner’s Equity

Drawings

Expenses

Correct! Wrong!

If total assets are $100,000 and liabilities are $40,000, owner’s equity equals?

$100,000

$40,000

$60,000

$140,000

Correct! Wrong!

Which of the following transactions decreases assets and liabilities?

Revenue earned

Owner’s investment

Loan repayment in cash

Goods purchased on credit

Correct! Wrong!

Which transaction increases both assets and liabilities?

Buying inventory on credit

Owner withdrawal

Paying electricity bill

Paying wages in cash

Correct! Wrong!

Which transaction affects only the equity side of the equation?

Owner withdraws cash

Paying supplier

Borrowing from bank

Purchase of inventory for cash

Correct! Wrong!

Which of the following leaves total assets unchanged?

Owner’s investment

Buying equipment with cash

Cash received from a loan

Cash sales

Correct! Wrong!

Which of the following transactions increases assets and decreases liabilities?

Paying creditor with cash

Collecting cash from debtors

Buying supplies for cash

Cash received from bank loan

Correct! Wrong!

If liabilities are $10,000 and equity is $25,000, assets are?

The effect of drawings on the accounting equation is?

Which transaction increases one asset and decreases another asset?

Which element is missing? Assets = Liabilities + ____?

If total assets are $100,000 and liabilities are $40,000, owner’s equity equals?

Which of the following transactions decreases assets and liabilities?

Which transaction increases both assets and liabilities?

Which transaction affects only the equity side of the equation?

Which of the following leaves total assets unchanged?

Which of the following transactions increases assets and decreases liabilities?

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