Basic Accounting_Quiz No. 2

Debit which means value received includes assets and does not include expenses.

• True
• False

All SFP items normally have debit balance, and SCI items normally have credit balance.

• True
• False

The difference between the total debits and credits in the accounts is called the account balance which results in an open account.

• True
• False

There is no effect in the amounts of the accounting equation if an asset is changed into another form of asset.

• True
• False

A personal drawing is normally a credit balance in the business records.

• True
• False

The normal balance of an account payable is a debit amount.

• True
• False

Credit represents increases in revenue, capital, and expenses.

• True
• False

Assets have normal debit balances. The allowance for doubtful accounts is not part of asset account because it has a normal credit balance.

• True
• False

To increase the amount of liability, the liability accounts should be credited.

• True
• False

The common item that makes financial reports as a fundamentally related transaction is the involvement of cash in every transaction.

• True
• False