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Which of the following is correct if a company purchases equipment for $70,000 cash?

Question 6 options:

	Total assets will increase by $70,000.
	Total assets will decrease by $70,000.
	Total assets will remain the same.
	Total owners' equity will decrease.

Question 7 (2 points)

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At the end of the current year, the owners' equity in Barclay Bakery is $246,000. During the year, the assets of the business had increased by $120,000 and the liabilities had increased by $72,000. Owners' equity at the beginning of the year must have been:

Question 7 options:

	$198,000.
	$174,000.
	$284,000.
	$438,000.

Question 8 (2 points)

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The change in owners' equity due to only revenue and expense transactions is explained by the:

Question 8 options:

	Statement of cash flows.
	Statement of financial position.
	Income statement.
	Tax return.

Question 9 (2 points)

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At December 31, Year 1, the accounting records of Braun Corporation contain the following items:

Accounts Payable	$ 16,000	Accounts Receivable	$ 40,000
Land	240,000	Cash	?
Capital Stock	?	Equipment	120,000
Building	180,000	Notes Payable	190,000
Retained Earnings	160,000

If Capital Stock is $320,000, total assets of Braun Corporation at December 31, Year 1, amounts to:

Question 9 options:

	$686,000.
	$926,000.
	$726,000.
	$106,000.

Question 10 (2 points)

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On the statement of financial position, how are assets and liabilities normally presented?

Question 10 options:

	Assets are presented in order of liquidity; liabilities are presented in the order in which they become due.
	Assets are presented in the order in which they become due; liabilities are presented in their order of permanence.
	Assets are presented in order of profitability; liabilities are presented in order of liquidity.
	Assets are presented in order of liquidity; liabilities are presented in order of profitability.