Suppose a company provides services to customers in the current period but does not collect cash from those customers. How will the basic accounting equation be affected in the current year?

	a.	Stockholders equity decreases
	b.	Assets increase
	c.	Liabilities increase
	d.	Expenses increase
	e.	No effect in the current year

On May 1, 2016, a company paid $9,000 for insurance to cover the next 12 months. On December 31, 2016, what adjusting entry does the company need to make for its year-end financial statements?

	a.	Debit Insurance Expense $3,000; Credit Prepaid Insurance $3,000
	b.	Debit Prepaid Insurance $3,000; Credit Cash $3,000
	c.	Debit Insurance Expense $6,000; Credit Prepaid Insurance $6,000
	d.	Debit Insurance Expense $6,000; Credit Cash $6,000
	e.	Debit Prepaid Insurance $6,000; Credit Insurance Expense $6,000

On July 16, a company received cash from a customer for services that were provided in June. Which of the following should be recorded on July 16?

	a.	Debit Cash; Credit Service Revenue
	b.	Debit Service Revenue; Credit Cash
	c.	Debit Cash; Credit Accounts Receivable
	d.	Debit Cash; Credit Deferred Revenue
	e.	Debit Accounts Receivable; Credit Service Revenue

The ending balance of retained earnings represents:

	a.	The total resources available to be distributed to owners.
	b.	The value created by the company for its owners and ditributed to the owners.
	c.	The value of the company from contributions by owners.
	d.	The total resources available to pay claims to resources
	e.	The value created by the company for its owners and kept in the company.