A withdrawal of funds by the owner for personal use is considered a business expense

A profit results when there is an excess of expenses over revenues.

If assets are $10,000 and liabilities are $5,000, owner's equity is $15,000.

Changes in owner's equity can result from revenue, expenses, and draws.

When cash is received from collecting an accounts receivable, the total amount of assets does not change.

A net profit for the period decreases owner's equity.

A business transaction affects at least two accounts.

The normal balance side of an account is the increase side.

Increases in assets are recorded with credits.

An increase in revenue results in an increase to owner's equity.

Cash, Accounts Receivable,and Owner's Equity are all examples of asset accounts.

Amounts that a business must pay in the future are called accounts receivable.

Assets and liabilities are reported in the Income Statement.

Debits are used to record increases in revenue.

Credits are used to record increases in liabilities, revenue, and owner's equity.

Assets, expenses, and draws normally have debit balances.

Revenue and Expense accounts are examples of permanent accounts.

A journal entry can consist of only one debit entry and only one credit entry.

A ledger is sometimes referred to as a record or book of original entry.

When a transaction is recorded in a journal, the total of the debit amounts must equal the total of the credit amounts.