# BAM 110 QUESTION BANK STUDY GUIDE 38/38 CORRECT ANSWERS - 93901

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BAM 110 QUESTION BANK STUDY GUIDE 38/38 CORRECT ANSWERS

1) Which of the following entries would be used to record the billing of fees earned?

A) Debit Accounts Receivable and credit Rental Fees

B) Credit Cash and credit Rental Fees

C) Debit Cash and credit Rental Fees

D) Debit Cash and debit Rental Fees

2) If total liabilities are \$1,000 and total assets are \$8,000, owner's equity must be:

A) \$7,000.

B) \$3,000.

C) \$10,000.

D) \$13,000.

3) Which of the statements of the rules of debit and credit is true?

A) Decrease Accounts Receivable with a credit and the normal balance is a credit.

B) Increase Accounts Payable with a credit and the normal balance is a credit.

C) Increase Capital with a debit and the normal balance is a debit.

D) Decrease Cash with a debit and the normal balance is a debit.

4) How does the purchase of office equipment on account affect the accounting equation?

A) Assets increase; liabilities decrease

B) Assets increase; owner's equity increases

C) Assets increase; liabilities increase

D) Liabilities increase; owner's equity decreases

5) Which of the following entries records the investment of cash by John, owner of a sole proprietorship?

A) Debit John, Capital; credit Cash

B) Debit Cash; credit John, Withdrawals

C) Debit John, Withdrawals; credit Cash

D) Debit Cash; credit John, Capital

6) Mary invested cash in her new business. What effect will this have?

A) Increase an asset and increase a liability

B) Decrease an asset and increase a liability

C) Increase an asset and increase owner's equity

D) Increase an asset and decrease owner's equity

7) Dennis, owner of Dennis' Golf Center, withdrew \$900 in cash from the business. Record the transaction by:

A) debiting Dennis, Withdrawals, \$900; crediting Cash, \$900.

B) debiting Accounts Receivable, \$900; crediting Cash, \$900.

C) debiting Expense, \$900; crediting Cash, \$900.

D) debiting Dennis,

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