10 Questions
What must assets equal according to the basic accounting equation?
The sum of liabilities and owner's equity
Which accounts have normal balances as credits?
Owner's equity accounts
What separates the left side (debit) from the right side (credit) of the accounting equation?
Equals sign
Which major accounts are perfectly captured by the accounting equation?
Assets, liabilities, and owner's equity
What is recorded in 'journals' and 'ledgers' in accounting?
Movements in specific accounts
What is the primary difference between a debit card and a credit card?
Whether money is borrowed or debited from an account
Which of the following is NOT considered a major account in accounting?
Capital gains
What does the term 'assets' refer to in accounting?
Future economic benefits owned by the business
In accounting, where are revenues and expenses classified?
Owner's equity
What defines an asset in accounting?
Anything of value owned by the business
Learn about the fundamental accounting equation where assets must equal liabilities and owner's equity. Understand how the equal sign maintains balance and separates debit and credit sides. Explore how this equation is crucial in the accounting cycle.
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