1. Which of the following is an equity account?

		A. accounts receivable
		B. cash
		C. accounts payable
		D. accumulated depreciation
		E. additional paid in capital

2. Expenditures made for items that will not be used immediately, but will be consumed or used up in the near future are called

		A. liabilities
		B. accrued expenses
		C. depreciation expense
		D. prepaid expenses
		E. equity

3. Which of the following is an equity account?

		A. bonds payable
		B. retained earnings
		C. cash
		D. equipment
		E. accumulated depreciation

3. Which of the following is a contra asset account?

		A. bonds payable
		B. retained earnings
		C. cash
		D. equipment
		E. accumulated depreciation

4. Expenses

		A. add to retained earnings.
		B. reduce retained earnings.
		C. have no effect on retained earnings.
		D. always result in a cash outflow.