Accounting 1 - Debits & Credits - Practice Accounting

Question 1

T-accounts

Answer 1

Charts used to record increases and decreases of individual accounts found on the balance sheet.

Question 2

Debits

Answer 2

Represent an increase in an asset but a decrease in a liability or equity.

Question 3

Credits

Answer 3

Represent a decrease in an asset but an increase in a liabilty or equity.

Question 4

Asset accounts will normally have

Answer 4

Debit balances.

Question 5

Liability & Equity accounts will normally have

Answer 5

Credit balances.

Question 6

Two special equity accounts are

Answer 6

Revenues and Expenses.

Question 7

Increases in equity and usually have a credit balance:

Answer 7

Revenues

Question 8

Decreases in equity and usually have a debit balance.

Answer 8

Expenses

Question 9

Are debited and credited like other equity accounts.

Answer 9

Revenues

Question 10

Are debited and credited like asset accounts.

Answer 10

Expenses

Question 11

Income Statements are

Answer 11

Used to calculate net income.

Question 12

Net income:

Answer 12

The difference between total revenues and total expenses (Net Income = Total Revenues ? Total Expenses)

Question 13

Company’s Financial position

Answer 13

Shown by Balance Sheets (record one point in history)

Question 14

Company?s Financial performance

Answer 14

Measured over a period of time in Income Statements.

Question 15

General Journal

Answer 15

The chronological record of every transaction.

Question 16

A journal uses the same rules as a

Answer 16

T-account uses the same rules as

Question 17

General Ledger

Answer 17

The collection of all T-accounts.

Question 18

Revenues and Expenses are

Answer 18

Temporary accounts. At the end of a period they are closed out and their balances are transferred to the income statement.

Question 19

Other asset, liability, and equity accounts are

Answer 19

Permanent accounts. They are not closed out, and their balances are transferred to the balance sheet.