D) liabilities. Answer: B Diff: 2 LO: 2-4 Analytical Skills AICPA Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 19) An important rule to remember when analyzing the impact of business transactions on accounts is: A) net income increases stockholders' equity. B) if expenses exceed revenues, the company will have a net income. C) a net loss does not affect stockholders' equity. D) stockholders' equity includes the two categories of income statement accounts, revenues and liabilities. Answer: A Diff: 2 LO: 2-4 AASCB: Analytical Skills AICPA Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 20) An important rule of debits and credits is: A) credits increase a liability account. B) debits decrease an asset account C) revenues are increased by a debit. D) expenses are increased by a credit. Answer: A Diff: 2 LO: 2-4 Analytical Skills Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 21) accounts are increased by debits? A) Cash and accounts payable B) Salaries expense and common stock. C) Accounts receivable and utilities expense D) Accounts payable and service revenue Answer: C Diff: 3 LO: 2-4 Analytical Skills Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 22) An account is increased by a debit and has a debit balance. This account is: A) an expense account. B) a liability account. C) an asset account.
D) liabilities. Answer: B Diff: 2 LO: 2-4 Analytical Skills AICPA Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 19) An important rule to remember when analyzing the impact of business transactions on accounts is: A) net income increases stockholders' equity. B) if expenses exceed revenues, the company will have a net income. C) a net loss does not affect stockholders' equity. D) stockholders' equity includes the two categories of income statement accounts, revenues and liabilities. Answer: A Diff: 2 LO: 2-4 AASCB: Analytical Skills AICPA Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 20) An important rule of debits and credits is: A) credits increase a liability account. B) debits decrease an asset account C) revenues are increased by a debit. D) expenses are increased by a credit. Answer: A Diff: 2 LO: 2-4 Analytical Skills Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 21) accounts are increased by debits? A) Cash and accounts payable B) Salaries expense and common stock. C) Accounts receivable and utilities expense D) Accounts payable and service revenue Answer: C Diff: 3 LO: 2-4 Analytical Skills Bus Persp: Strategic/Critical Thinking AICPA Functional: Measurement 22) An account is increased by a debit and has a debit balance. This account is: A) an expense account. B) a liability account. C) an asset account.
Test-Bank-for-Financial-Accounting-9E-9th-Edition.docx