Free Practice Quiz Question List

2 Accounts, Debits, and Credits Online Quiz Questions

Use this free practice quiz with 20 questions to review 2 Accounts, Debits, and Credits, test your knowledge, and prepare for your next test or exam.

20 questions

Written response

1 point

A business performs $1,200 of services on account. What amount is credited to Service Revenue?

Choose one

1 point

A business is setting up its accounting records. What is the main purpose of its chart of accounts?

A
It records only cash transactions.
B
It organizes the accounts a business uses and supports consistent transaction classification.
C
It guarantees that every account has a debit balance.
D
It replaces the general ledger.

True or false

1 point

In accounting, a debit always means an increase and a credit always means a decrease. True or false?

A
True
B
False

Written response

1 point

A business controls a resource that it expects to use in its operations. What account category does this resource belong to?

Choose one

1 point

A business needs to reduce its Accounts Payable balance. Which entry directly decreases that liability?

A
Credit Accounts Payable
B
Debit Cash
C
Debit Accounts Payable
D
Credit an expense account

Choose one

1 point

An owner contributes cash to the business. Which entry records the contribution?

A
Debit Cash; credit Owner Capital
B
Credit Cash; debit Owner Capital
C
Debit Cash; credit Service Revenue
D
Credit Cash; debit Rent Expense

Choose one

1 point

A business buys equipment for cash. What is the effect on total assets at the time of purchase?

A
Total assets increase because equipment is acquired.
B
Total assets decrease because cash is spent.
C
Liabilities increase and equity decreases.
D
One asset increases while another decreases, so total assets are unchanged.

Choose one

1 point

A business borrows money from a bank and receives the proceeds in cash. Which entry records this transaction?

A
Debit Loan Payable; credit Cash
B
Debit Cash; credit Loan Payable
C
Debit Cash; credit Owner Capital
D
Debit an expense; credit Loan Payable

Written response

1 point

What is the normal-balance side of Accumulated Depreciation?

Choose one

1 point

A service business earns revenue and receives the payment in cash. Which entry records the transaction?

A
Debit Service Revenue; credit Cash
B
Credit Cash; debit Owner Capital
C
Debit Cash; credit Service Revenue
D
Debit Cash; credit Accounts Payable

Choose one

1 point

A business pays cash for rent incurred in the current period. What is the effect on the accounting equation?

A
Assets and equity decrease.
B
Assets decrease and liabilities increase.
C
Assets are unchanged and equity increases.
D
Liabilities and equity decrease.

Choose one

1 point

An owner withdraws cash from the business for personal use. Which immediate effect on the accounting equation is correct?

A
Assets increase and equity decreases.
B
Assets decrease and equity decreases.
C
Assets decrease and liabilities decrease.
D
Assets and equity both remain unchanged.

Choose all

1 point

A business purchases $700 of supplies on account and records the transaction correctly. Select all statements that describe its immediate effects.

A
Assets increase by $700.
B
Liabilities increase by $700.
C
Equity increases by $700.
D
Total debits equal total credits.

Choose all

1 point

An accountant is checking which accounts normally increase with a debit. Select all that apply.

A
Cash
B
Wages Expense
C
Accounts Payable
D
Service Revenue

True or false

1 point

A correctly recorded transaction can affect more than two accounts and still have equal total debits and credits.

A
True
B
False

True or false

1 point

Two businesses may use different account numbers for the same type of account.

A
True
B
False

Written response

1 point

A business has assets of $18,500 and liabilities of $7,200. What is its equity? Enter the amount in dollars.

Fill in the blank

1 point

A contra account normally has a balance on the side from its related account.

Fill in the blank

1 point

In the expanded accounting equation, owner withdrawals are subtracted from .

Open ended

1 point

A business reports assets of $25,000, liabilities of $8,000, owner contributions of $20,000, revenues of $4,000, and expenses of $3,000. Use the expanded accounting equation to determine owner withdrawals and explain your calculation.