Test II Accounting Theory

A.  Answer the following blank provided:

1. The accounting equation is_______________ = _____________  +  ________________
2. Items owned by a business that have money value are known as _____________________
3. _____________ The process of recording the transactions in term of money.
4. Money owed to an outsider is a ____________________
5. The difference between assets and liabilities is ___________________
6. An investment in the business increases _________________ and ___________________
7. To purchase "on account" is to create a  _______________________
8. When the word "paid" occurs, it means a deduction of _______________
9. Income increases net assets and also __________________________
10. A withdrawal of cash reduces cash and _____________________

B. Differentiate between Accountant, and Bookkeeper

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C. What is Revenue, Expenses, and Profit? Explain in your own understanding.

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D. Explain between Capital, and Withdrawal? Liabilities VS Assets?
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