1. Assets are property or economic resources that are expected to provide a future benefit to a business.

True

False

2. Assets include accounts payable and notes payable.

True

False

3. Assets are equal to liabilities plus owner's equity.

True

False

4. If assets equal 100,000 and liabilities equal 25,000, then owner's equity is 125,000.

True

False

5. Credits increase asset and expense accounts.

True

False

6. Not all businesses use the same chart of accounts.

True

False

7. Payments made for an owner's personal expenses are charged to owner's draws.

True

False

8. If liabilities equal 75,000 and owner's equity equals 25,000, then assets are 50,000.

True

False

9. An investment by the owner to his/her business will decrease owner's capital.

True

False

10. The normal balance for the owner's drawing account is a credit balance.

True

False

11. Supplies On Hand would be classified as an expense.

True

False

12. Fees earned are classified as an asset account.

True

False

13. The cash account is increased with a credit.

True

False

14. A credit to Accounts Payable increases the accounts balance.

True

False

15. A credit to fees earned will increase the balance of the fees earned account.

True

False

16. Whether a debit or credit increases or decreases an account's balance depends on the type of account.

True

False

17. The profit or loss for a period is reported using a balance sheet.

True

False

18. The financial position of a business as of a specific date is reported using a balance sheet.

True

False

19. Accounts payable, notes payable, taxes payable, and accounts receivable are all types of liability accounts.

True

False

20. The amount calculated by subtracting total liabilities from total assets is called owner's equity or net assets.

True

False