1.3.1

Question 0

Every transaction must have m. 1x ____ & _____

Answer 0

Debit & Credit.

Question 1

3 Fundamental Bookkeeping Equations:

Answer 1

1) Assets = Liabilities + Stockholders’ Equity
2) Sum of Debits = Sum of Credits
3) Beginning Balance + Increases - Decreases = Ending Account Balance

Question 2

Debits = credits for?

Answer 2

All transactions

Question 3

Any negative #’s debit/credit?

Answer 3

No negative #’s debit/credit, transactions always positive

Question 4

T-Account

Answer 4

Record all changes accounting quantity

- Debits left & Credits right side of T

Question 5

Account Balance

Answer 5

Difference b/w sum of debits & credits for account (@ certain time)

Question 6

Assets & Expenses D/C?

Answer 6

Normal balance is Debit.

• Increase through Debit
• Decrease through CreditS

Question 7

Liabilities, Stockholders Equity & Revenues D/C?

Answer 7

Normal balance is credit.

• Decrease through Debits
• Increase through Credits.

Question 8

3 questions when analyzing transactions?

Answer 8

1) Which specific asset/liability/stockholders’ equity/revenue (RE)/ expense (RE) accounts does transaction affect?
2) Does transaction +/- affected accounts?
3) Should accounts be debited/credited?

Question 9

Journal Entry Format

Answer 9

• Shorthand what happened in transaction

Dr. < Name Account Debited > $ XXX
Cr. < Name Account Credited > $XXX

• Debits always 1st
• Credits always indented

Question 10

Notes Receivable

Answer 10

Employee Owes $ for loan

Question 11

Retained earnings debit/ credit balance?

Answer 11

Can have both.

Question 12

Dividends Payable

Answer 12

Money paid stockholders