Multiple choice- Identify the choice that best completes the statement the letter of answers the question. 1. ledger is a. a group of accounts for a business entity entity b. a collection of financial statements for a business are recorded c. a book in which cash receipts and disbursements d. a book in which journal entries are initially recorded 2 When a company records closing entries, which of the following occurs? a. All revenue and expense accounts are reduced to zero b. Owners' equity is reduced to zero c. All asset and liability accounts are reduced to zero d. The company is liquidated 3 Which of the following statements about double-entry accounting is TRUE? a. Each transaction is debited must equal the sum the amounts credited The sum of the recorded twice of b. another account must be decreased c. lf one account is increased, then accounting systems d. Double-entry bookkeeping only applies to manual 4 Which of the following statements is TRUE? as debits a. Increases to accounts are recorded b. Decreases to all accounts are recorded as credits c. The left side of all accounts is the debit side d. Credits refer to "favorable" changes in account balances 5. Which of the following is a TRUE statement of the accounting equation? a. assets liabilities owners' equity revenues b. assets expenses abilities owners' equity net income c. Owners' equity nvestments withdrawals d. Net income revenues expenses 6. Which of the following is a temporary account? a. Depreciation expense b. Cash c. Unearned revenue d. Accumulated depreciation 7 An adjusting entry requires the use of a. two balance sheet accounts b. the cash account and an income statement account c. an income statement account and a balance sheet account d. two income statement accounts