19 If a business pays back a $5,000 loan of which $300 is interest, which of the following is true? ut of zestion Select one: O a. Cash decreases by $5,000, equity decreases by $300. O b. Cash decreases by $5,000, equity decreases by 54,700. Oc Cash decreases by $5,000, equity decreases by 55,000 O d. Cash decreases by $5,000, equity does not change. O e None of the above. 20 If the owner or owners of a business can sell or transfer their ownership to another person without affecting the operation of the business what type of business is it? out of question Select one: O a Sole Proprietorship. O b. Partnership Oc Corporation Od. Two of the above e. All of the above. 21 Which fundamental characteristic of GAAP requires that information is free from material error and blas? ut of Select one: O a Understandability, O b. Comparability OC Reliability uestion O d. Relevance 22 The total amount of depreciation recorded for an asset during the entire time the asset has been owned: d out of Select one: O a. is shown on the income statement. question O b. is referred to as accumulated depreciation. OC. is shown on the statement of owner's equity. d. Is recorded in a liability O e. is not shown on the balance sheet. 23 Atrial balance prepared after the adjusting and dosing entries have been posted, and which is the final step in the accounting cycle, is a ed out of question Select one O a Adjusted trial balance ob Post-dosing trial balance. Oc Worksheet od Book of final entry De Unadjusted trial balance. 24 A 10-column spreadsheet used to draft a company's uradjusted trial balance, adjusting entries, adjusted trial balance, and financat statements, and which is an optional step in the accounting process is an out of question Select one O a Book of final entry Ob Post-closing triat bafance OC Worksheet Od. Unadjusted trial balance e Adjusted trial balance. 25 Incurred but unpaid expenses that are recorded during the adjusting process with a debit to an expense and a credit to a liability we called out of Select one: O a Operating expenses. Ob Prepaid expenses Oc Unearned expenses. question Od Accrued expenses. O e None of the above - no adjusting entry required because the expenses are unpaid. 26 The statement of owner's equity is the link between d out of uestion Select one: O a Debits and credits. Ob. The Income Statement and the Balance Sheet. Oc The ledger and the trial balance. Od. The journal and the ledger 27 In which type of organization does the owner or owners have unlimited liability? ed out of Select one: Sole Proprietorship O b. Partnership Oc Corporation question od Two of the above All of the above, 28 The Thornhill Post, a weekly suburban newspaper, receives annual subscriptions in the amount of $50,000 in January which have been prepaid for the whole year. Which of the following transactions is correct at the time the subscriptions are received d out of question Select one: O a Increase cash and increase owners equity O b. Increase cash earned and increase revenues OC. Increase cash and increase unearned revenue Od. Increase cash and decrease prepaid expenses 29 Employers never make deductions from employees wages for out of Select one: O a. Federal Income Taxes O b. Union Dues. Oc Worker's Compensation Question d. Canada Pension Plan O e Employment Insurance, 30 Extreme Cruise Inc. prepaid 54,500 for 3 months rent on July 1, 2010, what would be the balance of the Prepaid Rent account on September 1,2010 out of Select one: O a $3,000 question Ob $4.500. OC$1,500 Od 50