18) Which of the following is a component of stockholders equity? A) Retained earnings C) Fixed assets B) Notes payable D) Cash 19) The term "double-entry accounting" indicates that the accountant: A) identifies both the cash inflows and the cash outflows B) uses both the geheral journal and the general ledger when recording transactions. C) computes the income statement and balance sheet effect of each transaction. D) records both sides of each transaction in the accounts affected. 20) A company paid cash for employee wages. This transaction: A) increased cash and increased expenses. B) decreased cash and decreased revenues. C) decreased cash and increased expenses. D) increased cash and decreased expenses. 21) The owner of a business paid cash from his personal checking account to purchase an automobile for his personal use. This transaction: A) decreased cash and increased expenses. B) increased a liability account and increased liabilities. C) increased assets and increased owners' equity D) is not a transaction recognized by the business. 22) All of the following accounts would be considered assets EXCEPT for A) prepaid expenses. C) retained earnings. B) notes receivable D) cash. 23) Which accounts are increased by debits? A) Assets, expenses and dividends B) Expenses and owners' equity C) Assets, expenses and owners' equity D) Assets and owners' equity 24) In accounting, the process of posting involves transferring data from: A) the ledger to the journal. B) the source documents to the journal. C) the source documents to the ledger. D) the journal to the ledger 25) The entry to record the purchase of supplies on account would include a debit to: A) Supplies. C) Retained Earnings. B) Accounts Payable. D) Supplies Expense. 26) Paying a dividend to the company's stockholders would include a debit to: A) Cash and a credit to Dividends. B) Dividends and a credit to Cash. C) Accounts Payable and a credit to Retained Earnings. D) Retained Earnings and a credit to Cash