Accounting 1 FINAL

A business paid cash: for rent, $700.00; to the owner for personal use, $200.00; and for an equipment repair, $50.00.  Expenses from the operation of the business decreased the owner’s equity by 

• $250

• $750

• $950

• none of these

When cash is received from sales,

• assets increase; the owner’s equity decreases.

• assets increase; the owner’s equity increases.

• assets decrease; the owner’s equity decreases.

• none of these

If a business paid cash for repairs to equipment, this would

• increase the owner’s equity.

• increase liabilities.

• decrease owner’s equity.

• decrease liabilities.

If a business received $2000.00 from sales, this would 

• increase assets and increase the owner’s equity.

• increase assets and decrease liabilities.

• increase liabilities and decreases owner’s equity.

• decrease assets and decrease owner’s equity.

When the owner withdrawals cash for personal use,

• liabilities increase and assets decrease.

• assets decrease and the owner’s equity increases.

• assets decrease and the owner’s equity decreases.

• liabilities decrease and assets decrease.

Two transactions that decrease the owner’s equity are

• expenses and withdrawals.

• expenses and investments.

• withdrawals and liabilities.

• liabilities and expenses.

Recording an expense transaction in an accounting equation causes liabilities to

• to remain unchanged.

• increase.

• decrease.

• none of these.

A transaction that increases cash and decreases owner’s equity is

• revenue.

• withdrawal.

• expense.

• none of these.

The Supplies account is classified as 

• Asset

• Liability

• Owner's Equity

The Supplies account Normal Balance is a 

• Debit

• Credit