7. Which one of the following represents the expanded basic accounting equation? A) Assets – Liabilities + Owner’s Capital + Owner’s Drawings – Revenue – Expenses. B) Assets + Owner’s Drawings + Expenses = Liabilities + Owner’s Capital + Revenues. C) Assets – Liabilities – Owner’s Drawings = Owner’s Capital + Revenues – Expenses. D) Assets = Revenues + Expenses – Liabilities. 8. An account will have a credit balance if the A) credits exceed the debits. B) first transaction entered was a credit. C) debits exceed the credits. D) last transaction entered was a credit. 9. For the basic accounting equation to stay in balance, each transaction recorded must A) affect two or less accounts. B) affect two or more accounts. C) always affect exactly two accounts. D) affect the same number of asset and liability accounts. 10. At December 1, 2012, Cursive Company’s accounts receivable balance was $1,200. During December, Cursive had credit revenues of $4,800 and collected accounts receivable of $4,000. At December 31, 2012, the accounts receivable balance is A) $400 debit. B) $2,000 debit. C) $400 credit D) $2,000 credit. 11. The time period assumption states that A) a transaction can only affect one period of time. B) estimates should not be made if a transaction affects more than one time period. C) adjustments to the enterprise’s accounts can only be made in the time period when the business terminates its operations. D) the economic life of a business can be divided into artificial time periods. 12. Which of the following are in accordance with generally accepted accounting principles? A) Accrual basis accounting B) Cash basis accounting C) Both accrual basis and cash basis accounting D) Neither accrual basis nor cash basis accounting
AnswerSolution 7: Expanded accounting equation represents: Assets + Owner’s drawings + Expenses = Liabilities + Owner’s capital + Revenues Hence option B is correct. solution 8: An account will have a credit balance if “Credits exceed the debits” Hence option A is correct. solution 9: For basic accounting equation to stay in balance, each transaction recorded must “affect two or more accounts” Hence option B is correct. solution 10: At dec 31, 2012, accounts receivables balance is = $1,200 + $4,800 – $4,000 = $2,000 debit Hence option B is correct.
Note: As multiple questions are posted, i have answered more than required questions as per chegg policy, kindly post separate question for answer of remaining questions.