Deck 2: Debit and Credit Parts

Question 1

An accounting device used to analyze transactions is a T account.

Answer 1

True

Question 2

An amount recorded on the right side of a T account is a debit.

Answer 2

False

Question 3

Each asset account has a normal credit balance.

Answer 3

False

Question 4

Each liability account has a normal debit balance.

Question 5

Asset accounts decrease on the credit side.

Question 6

Each transaction changes the balances in at least two accounts.

Question 7

A list of accounts used by a business is a chart of accounts.

Question 8

When cash is paid for supplies, the Supplies account is increased by a credit.

Question 9

Common accounting practice is to record withdrawals as debits directly in the owner's capital account.

Question 10

The left side of an asset account is the credit side because asset accounts are on the left side of the accounting equation.

Question 11

A drawing account is increased by debits and decreased by credits.

Question 12

Increases in expense accounts are recorded as debits because they decrease the owner's capital account.

Question 13

The normal balance side of an Accounts Receivable account is a debit.

Question 14

Utilities Expense is increased with a debit.

Question 15

Cash is increased with a debit.

Question 16

Prepaid Insurance is decreased with a credit.

Question 17

To summarize withdrawal information separately from the other records, owner withdrawal transactions are recorded in the owner's capital account.

Question 18

Decreases to liability accounts are recorded on the credit side.

Question 19

The left side of a T account is the

A) debit side.
B) credit side.
C) normal balance side.
D) equity side.

Question 20

If an amount is recorded on the side of a T account opposite the normal balance side, the account balance is

A) increased.
B) decreased.
C) unaffected.
D) correct.

Question 21

The normal balance side of a liability account is the

A) debit side.
B) credit side.
C) decrease side.
D) left side.

Question 22

When an owner invests cash in a business, the owner's capital account is

A) increased by a debit.
B) increased by a credit.
C) decreased by a debit.
D) decreased by a credit.

Question 23

When a business pays cash on account, a liability account is

A) increased by a debit.
B) increased by a credit.
C) decreased by a debit.
D) decreased by a credit.

Question 24

When cash is received from sales, the change in the owner's equity is usually recorded

A) on the debit side.
B) directly in the owner's capital account.
C) as interest revenue.
D) in a separate revenue account.

Question 25

Increases in a revenue account are shown on a T account's

A) debit side.
B) left side.
C) credit side.
D) none of these.

Question 26

When $1,500 cash is received on account,

A) Sales is increased with a credit and Cash is increased with a credit.
B) Accounts Receivable is increased with a debit and Cash is increased with a credit.
C) Accounts Receivable is decreased with a credit and Cash is increased with a debit.
D) Accounts Receivable is decreased with a debit and Cash is increased with a debit.

Question 27

The normal balance side of any revenue account is the

A) debit side.
B) credit side.
C) left side.
D) none of these.