Q4, A partnership is a business which is:

A) easy to form.

B) ends with the death of a partner.

C) All of these answers are correct.

Q6, A corporation:

A) can continue indefinitely.

B) has limited risk to stockholders.

C) All of the above

Question 11, A business received $3,000 from a customer in payment of an amount owed. The effect of the transaction on the accounting equation was to:

A)increase one asset, decrease another asset.

B)increase an asset, increase a liability.

C)decrease an asset, decrease a liability.

Question 15, The net income or net loss is calculated on the:

A)statement of owner's equity.

B)income statement.

C)None of these

Question 21, The side that increases the account balance, by the rules of debit and credit, is said to be the:

A)debit side.

B)normal balance.

C)None of these answers is correct.

Q22, The Accounts Payable account is:

A)a capital, and it has a normal debit balance.

B)an expense, and it has a normal credit balance.

C)a liability, and it has a normal credit balance.

Question 26, Extreme Home bought painting equipment on account for $3,000. The entry would include:

A)debit to Supplies Expense, $3,000; credit to Cash, $3,000.

B)debit to Equipment, $3,000; credit to Accounts Payable, $3,000.

C)debit to Supplies Expense, $3,000; credit to Accounts Payable, $3,000.

Question 28 , A debit to a liability account was posted as a debit to a revenue account. This error would cause:

A)revenues to be understated.

B)liabilities to be understated.

C)None of the above is correct.

Q30, What would be the effect on the accounts if the business purchased office supplies for cash?

A)An asset would be debited and an expense debited.

B)An asset would be debited and Revenue credited.

C)An asset would be debited and an asset credited.