7 The accounting equation for Quattro Enterprises is as follows: 3PTS ASSETS UABILITIES Owner's Equity 120,000$60,000 60,000 If Quattro purchases Office equipment on account for $15,000 the change to Purchas ASSETS LIABILITIES OWNER"S EQUITY a $120,000- 60,000 60,000 b. 135,000 60,000 75,000 135,000 67,500 67,500 d. 135,000 75,000 60,000 8 Adjusting entries are required 3PTS a. Yearly b. Quarterly c. Monthly d. Every time financial statements are prepared 9 Expenses incurred and not yet paid or recorded are called 3PTS a. Prepaid expenses b. Accrued expenses c. Interim expenses d. Unearned expenses 10 The closing entry process consists of closing 3PTS All assets and liabilities accounts a. b. c. d. Out the owner's capital account All permanent accounts All temporary accounts 11 A post-closing Trial balance will show 3PTS a. Zero balances for all accounts b. Zero balances for balance sheet accounts c. Only balance sheet accounts d. Only income statement accounts 12 Sales revenue less cost of goods sold is called 3PTS a. Gross profit b. Net proft c. Net income d. Marginal income