liabilities and equity in accounting coursera week 4 quiz answers
Accounts Payable, Cash Payments, Sales Tax Payable Practice Quiz
1. Moe's Fro Yo makes a payment on a long-term note. What is the effect on the accounting equation?
- Assets would decrease. Liabilities would decrease. There would be no effect on Equity.
- There would be no effect on Assets. Liabilities would increase, and equity would increase.
- Assets would increase. Liabilities would decrease. There would be no effect on Equity.
- No effect on Assets. Liabilities would increase. The Equity would decrease.
2. Gene's Gummy Shoppe purchased inventory from a vendor on credit and will pay the invoice at a later date when it is due. What is the effect on the accounting equation?
- Assets would decrease. Liabilities would increase. Equity would increase.
- Assets would increase. Liabilities would decrease. There would be no effect on Equity.
- Assets would increase. Liabilities would decrease. Equity would decrease.
- Assets would increase. Liabilities would increase. There is no effect on Equity.
3. Harry's Handsome Cuts, a barber, hired Candy's Consultants, a consulting firm, to do consulting work. Candy's Consultants has billed Harry's Handsome Cuts $5,000, which will be due in August. What is the effect on the accounting equation?
- Assets would decrease. Liabilities would increase. Equity will increase.
- No change to Assets, Liabilities would increase, Equity would decrease.
- No change to Assets, Liabilities would decrease, Equity would increase.
- Assets would increase, no change to Liabilities, Equity would decrease.
Practice with Payroll Practice Quiz
4. True or False: The more you pay out to employees in wages and salaries the less cash you’ll have on hand in your assets to pay off liabilities.
- True
- False
5. Which of the following best describes the journal entry for recording employee wages?
- Debit both wage expense and cash and credit all employee deductions
- A debit to cash and a credit to all employee deductions and wage expense
- A debit to all employee deductions and a credit to wage expense and cash
- A debit to wage expense and a credit to all employee deductions and cash
6. Which of the following best describes the journal entry for recording the employer’s expense?
- A debit to all taxes payable and a credit to payroll tax
- A credit to both payroll tax and to all taxes payable
- A debit to payroll tax and a credit to all taxes payable
- A debit to both payroll tax and to all taxes payable
Practice with Bank Loans and Equity Practice Quiz
7. Greenwald’s Groceries took a loan for $20,000 to cover a new deli slicer. The effect of this transaction on the accounting equation will be:
- Assets and Equity increase
- Assets and liabilities decrease depending on how much the current assets are
- Assets and Liabilities increase by $20,000
- Assets and liabilities decrease by $20,000
8. Using the accounting equation, if assets and liabilities both decrease by $4,000, what is the effect on owner's equity?
- No Effect
- Decreases by $8,000
- Increases by $8,000
Shuffle Q/A 1
9. Using the accounting equation, if owner equity increases by $10,000 and liabilities decrease by $20,000, what do assets change by?
- No change
- Increase by $10,000
- Decrease by 10,000
10. Using the accounting equation, if liabilities increase by $6,000 and equity reduces by $10,000, what is the change in assets?
- Decrease of $4,000
- Increase of 4,000
- No change
