3N1 WA1: POA Topic 4a Double-Entry Recording

Which of the following is the expanded accounting equation?

• Liabilities = Assets - Equity

• Assets = Liabilities + (Capital + Income - Expense + Drawings)

• Assets = Liabilities + (Capital + Income + Expense - Drawings)

• Assets = Liabilities + (Capital + Income - Expense - Drawings)

Select the two accounts and amounts reflecting the effects of the following transaction:

Owner took goods worth $100 from the business for personal use.

• Drawings

  - $100

• Drawings

  + $100

• Inventory

  - $100

• Inventory

  + $100

The following balances were extracted from the business' books:

Cash in hand $500

Trade receivables $1,200

Trade payables $700

Office equipment $6,600

Inventory $2,000

Bank overdraft $1,600

Equity $?

Calculate the equity of the business.

• $7,000

• $8,000

• $9,400

• $12,600

Every business transaction will affect at least ________ accounts

One of the double-entry recording rules: The total amount debited must ________ the total amount credited

• equal

• be more than

• be less than

• minus