Chapter 3 Flashcards
How accounts effect the accounting equation
1
Q
What is the accounting equation (3 points)
A
The accounting equation states that
Assets= liabilities +stockholders equity
2
Q
What are the 2 sub categories of stockholders equity and the 3 subcategories or retained earnings equity? (3 points)
A
Stockholders equity= common stock +retained earnings
Retained earnings = revenue - expenses - dividends