1.A law firm received $2000 cash for legal services to be rendered in the future. The full amount was credited to the liability account Unearned Legal Fees. If the legal services have been performed at the end of the accounting period and no adjusting entry is made, this would cause

Select one:

Select one:a.

liabilities to be understated.

b.

profit to be overstated.

c.

expenses to be overstated.

d.

revenue to be understated.

2.

The statement that is true is

Select one:

Select one:a.

Credits decrease assets and increase liabilities.

b.

Debits decrease liabilities and decrease assets.

c.

Debits increase assets and increase liabilities.

d.

Credits decrease assets and decrease liabilities.