Give an example of a transaction that results in: a.    A decrease in an asset and a decrease in a liability. b.    A decrease in one asset and an increase in another asset. c.    A decrease in one liability and an increase in another liability.

Q: The recognition of income occurs simultaneously with the recognition of decrease in assets or…

A: Income is recognized in the books of accounts of an entity if the value of assets is increasing, or…

Q: Depreciation is generated due to a. Increase in the value of liability Ob. Decrease in capital…

A: Lets understand the meaning of depreciation. Depreciation is a reduction in value of asset due to…

Q: hich one of the following category prepaid expenses belong to? a. Current asset b. Intangible asset…

A: Prepaid expenses are those expenses which are paid in advance for future period of time and expenses…

Q: Adjustment for accrued revenue requires a/an choose correct answer a. decrease liabilities…

A: Lets understand the basics. Adjustment entry is required to make to record correct amount of revenue…

Q: Failure to record depreciation at the end of an accounting period results in a. Overstated expenses…

A: The business organizations are required to charge the depreciation expense on their assets so that…

Q: Any amount by which capital at the end of a period exceeds the amount required to maintain opening…

A: Any amount by which capital at the end of a period exceeds the amount required to maintain opening…

Q: Assets that are NOT expected to provide benefits for a number of accounting periods are called…

A: Solution: Assets that are NOT expected to provide benefits for a number of accounting periods are…

Q: Provide an example of a transaction that would increase one asset account but not change the amount…

A: The transaction in the business can effect different accounts as debit and credit.

Q: Explain is a change in depreciation method a change in accounting principle, or is it a change in…

A: According to the Accounting Standard 1-  the change in the method of depreciation is a change in the…

Q: Which of the following would trigger a subtraction in the indirect operating section? A. decrease in…

A: The correct option is B that is, gain on sale of investments as it is a non-operating gain that is…

Q: Given the dual effects of accountable events, an decrease in an asset cannot possibly be accompanied…

A: Assets = Liabilities + Stockholders equity Every transaction has dual effect .  The question is…

Q: A credit to a liability account a) indicates a decrease in the amount owed to creditors. b) is an…

A: Amount owed  by the company to the outside persons such as suppliers, bank etc are called…

Q: provide an example of a transaction that would: increase one asset account but not change the amount…

A: Increase in one asset account but not change the amount of total assets.Transaction: Purchase of…

Q: Accounting The account "Net-Assets: Resources Released from Restriction" is used to: A) Reduce…

A: Correct option with proper explanation are as follows

Q: A debit to an asset account indicates: Select one: O a. a credit was made to a liability account O…

A: Normally all assets accounts should have debit balance. All liability and capital accounts should…

Q: acquisition of vehicle is recorded twice, a. asset is overstated. b. expense is overstated. c.…

A: acquisition of vehicle results in inflow of vehicle and outflow of cash

Q: Payment to a creditor will Decreases an asset and decreases owner's equity Increases an asset and…

A: Accounting equation: Accounting equation is an accounting tool expressed in the form of equation, by…

Q: As prepaid assets are used to generate revenue, an adjustment is necessary to reduce the previously…

A: Prepaid assets are those assets which consists of advance payments for goods and services that are…

Q: Which of the following is Not correct An increase in a liability may result in a decrease in owner's…

A: The accounting equation is known as the equation that describes the transaction in accounting form.…

Q: Accounts payable would appear on the balance sheet as a(n) a. asset b. liability c. unearned…

A: Account payable is the account that represents the accounts from where purchases of inventory have…

Q: What is the effect of omission of accrued expenses in assets at the end of the year of error? a.…

A:

Q: (a)  When would the disposal of a long-term asset result in no gain or loss? (b)  When would the…

A: Long-term assets can be defined as those assets which are held by an investor for a period of more…

Q: A ____ will cause Accumulated Depreciation to decrease. A. Debit  B. Credit

A: Particulars debit credit Depreciation Amt   Accumulated depreciation   Amt

Q: If a transaction has the effect of decreasing an asset, is the decrease recorded as a debit or as a…

A: Generally, Assets have a Debit Balance If any account generally has a debit balance and if a…

Q: For each of the following situations, indicate whether itrepresents an accounting error and explain…

A: Answer:   Accounting error.

Q: When an asset is purchased on account, the credit side of the entry is to a liability account an…

A: Introduction:- The following golden rules used in accounting as follows under:- Personal:- Debit…

Q: What is the effect of omission of accrued expenses in assets at the end of the year of error? Group…

A: The correct option with proper explanation are as follows

Q: As per double entry rules, when will you DEBIT? a. If there is decrease in asset b. If there is…

A: Debit Credit     Assets Increase Decrease     Liabilities Decrease Increase…

Q: A decrease in an asset account is a:  A. Debit entry to the asset account B. Credit entry to the…

A: Assets are the resources that are owned by the entity for the purpose of using them to run the…

Q: Which of the following items represent a deferral ?                                      A. Prepaid…

A: In accounting, deferral means to defer or delay recognizing certain revenues or expenses on the…

Q: Record the entry to adjust asset values to fair value.

A: In this problem assets are revalued at a gain.  So the gain i.e difference…

Q: Would a change from straight line depreciation to double declining balance be a change in accounting…

A: Accounting changes:   When a company requires to sacrifice the consistent accounting methods and…

Q: Is a transaction that has the effect of lowering an asset recorded as a debit or as a credit? Is the…

A: A transaction is a business engagement that has an economic effect on a financial statement and is…

Q: Occasionally, events occur that change an asset's value after purchase. Which of the following is…

A: Solution: "Reductions in asset value are recognized" is true regarding these changes in value. This…

Q: Which accounting concept is applied when an entry is made for bad debts? A. Going-concern B.…

A: The accounting is based on various defined principles.

Q: Revaluation account is normally not credited with which of the following items: Increase in the…

A: Revaluation account is usually prepared to report the variations in the worth of assets and…

Q: An increase in an asset account is a:  A. Debit entry to the asset account B. Credit entry to the…

A: Assets are those tangible and intangible things in the business which the business has right to use…

Q: If an asset account is credited, it indicates O An error. O An increase in the asset. O A decrease…

A: Increase in liabilities should be credited and decrease in liabilities should be debited.

Q: What is the effect of recording an accrued expense? Increase an expense; decrease an asset Decrease…

A: Under the accrual basis of accounting, transactions are recorded as and when they occur irrespective…

Q: The term expense represents a decrease in asset that always results in decrease in equity

A: The income statement records the revenues and expenses incurred during the period.

Q: Which accounting concept is applied when an entry is made for provision for bad debts? A. Going-…

A: A. Going - concern - Under this concept , it is assumed that an entity will continue its operation…

Q: Allowance for doubtful accounts is an example of a. Asset account b. Expense account c. Contra asset…

A: solution:- Introduction:- Allowance for doubtful accounts means as follows under:- Allowance for…

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is