Admas University PA-I Class work A

Make a group consists of 4 students and answer the following questions accordingly.
1. The Accounting Equation is
A. Owner's Equity = Assets + Liabilities C. Assets = Liabilities + Owner's Equity
B. Assets = Liabilities - Owner's Equity
2. Items owned by a business that have money value are known as
A. Liabilities B. Owner's Equity C. Assets
3. What is the interest of the owners in the business known as?
A. Assets B. Owner's Equity C. Liabilities
4. Money owed to an outsider is known as
A. Asset B. Liability C. Owner's Equity
5. Assets minus Liabilities equals to ___________________.
6. Cash, Debtors (A\R), Land and Equipment are examples of __________. (State whether these
are Assets, Liabilities or Owner's Equity).
7. Creditors (A\P), Short Term Loan and Notes Payable are examples of __________. (State
whether these are Assets, Liabilities or Owner's Equity).
8. Capital, drawings and net income will affect ___________. (State whether these affects Assets,
Liabilities or Owner's Equity).
9. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Invested cash in a business: Assets ___ = Liabilities ____ + Owner's Equity ____ State
your answer in the box in this format, for example: i n i (This means Assets increased, Liabilities
have no effect and Owner's Equity increased.)
10. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Purchased equipment for cash: Assets ___ = Liabilities ____ + Owner's Equity ____ State
your answer in the box in this format, for example: i n i (This means Assets increased, Liabilities
have no effect and Owner's Equity increased. If Assets increased and decreased and Liabilities
have no effect and Owner's Equity has no effect, the answer should be id n n).
11. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Purchased vehicle on credit: Assets ___ = Liabilities ____ + Owner's Equity ____ State
your answer in the box in this format, for example: i n i (This means Assets increased, Liabilities
have no effect and Owner's Equity increased. If Assets increased and decreased and Liabilities
have effect and Owner's Equity has no effect, the answer should be id n n).
12. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Paid creditors: Assets ___ = Liabilities ____ + Owner's Equity ____ State your answer in
the box in this format, for example: i n i (This means Assets increased, Liabilities have no effect
and Owner's Equity increased. If Assets increased and decreased and Liabilities have no effect
and Owner's Equity has no effect, the answer should be id n n).
13. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Borrowed monies from bank: Assets ___ = Liabilities ____ + Owner's Equity ____ State
your answer in the box in this format, for example: i n i (This means Assets increased, Liabilities
have no effect and Owner's Equity increased. If Assets increased and decreased and Liabilities
have no effect and Owner's Equity has no effect, the answer should be id n n).
14. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Received monies from debtor: Assets ___ = Liabilities ____ + Owner's Equity ____ State
your answer in the box in this format, for example: i n i (This means Assets increased, Liabilities
have no effect and Owner's Equity increased. If Assets increased and decreased and Liabilities
have no effect and Owner's Equity has no effect, the answer should be id n n).
15. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Withdrew monies for personal use: Assets ___ = Liabilities ____ + Owner's Equity ____
State your answer in the box in this format, for example: i n i (This means Assets increased,
Liabilities have no effect and Owner's Equity increased. If Assets increased and decreased and
Liabilities have no effect and Owner's Equity has no effect, the answer should be id n n).

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By: Taddesse K.
Admas University PA-I Class work A

16. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Owner contributed some furniture to the business: Assets ___ = Liabilities ____ + Owner's
Equity ____ State your answer in the box in this format, for example: i n i (This means Assets
increased, Liabilities have no effect and Owner's Equity increased. If Assets increased and
decreased and Liabilities have no effect and Owner's Equity has no effect, the answer should be
id n n).
17. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Sold away motor vehicle on credit: Assets ___ = Liabilities ____ + Owner's Equity ____
State your answer in the box in this format, for example: i n i (This means Assets increased,
Liabilities have no effect and Owner's Equity increased. If Assets increased and decreased and
Liabilities have no effect and Owner's Equity has no effect, the answer should be id n n).
18. Determine the net effect of the transaction by keying in i = increased, d = decreased, n = no
effect. Repay a bank loan: Assets ___ = Liabilities ____ + Owner's Equity ____ State your answer
in the box in this format, for example: i n i (This means Assets increased, Liabilities have no effect
and Owner's Equity increased. If Assets increased and decreased and Liabilities have no effect
and Owner's Equity has no effect, the answer should be id n n).
19. Bought equipment worth $10,000 on credit.
A. Equipment decreased by $10,000 & Debtors decreased by $10,000
B. Equipment increased by $10,000 & Creditors increased by $10,000
C. Equipment decreased by $10,000 & Debtors increased by $10,000
D. Equipment increased by $10,000 & Bank loan increased by $10,000
20. Paid creditor $5,000.
A. Creditors increased by $5,000 & Cash decreased by $5,000
B. Creditors decreased by $5,000 & Cash decreased by $5,000
C. Creditors increased by $5,000 & Cash increased by $5,000
D. Creditors decreased by $5,000 & Cash increased by $5,000
21. Owner contributed $7,500 cash and $15,000 vehicle to the business.
A. Cash increased by $7,500, Vehicle increased by $15,000 & Capital increased by $22,500
B. Cash increased by $7,500 & Capital increased by $7,500
C. Cash increased by $7,500, Vehicle increased by $15,000 & Capital increased by $7,500
D. Cash increased by $7,500, Vehicle increased by $15,000 & Capital decreased by $22,500
22. Owner took some office equipment for personal use.
A. Equipment increased & Capital increased
B. Equipment decreased & Capital increased
C. Equipment decreased & Capital decreased
D. Equipment increased & Capital decreased
23. Which accounting concept gives rise to the accounting equation?
A. Historical cost C. Monetary concept
B. Going concern D. Accounting entity
24. Which accounting theory states that all transactions must be recorded at their cost at the time
the transaction takes place?
A. Cost Principle C. Monetary concept
B. Going concern D. Accounting entity
25. C.K. Enterprise has Furniture $4,000, Supply inventory $5,000, debtors (A/R) $2,750, bank
balance $3,450 and creditors (A/P) $1,250. Calculate the amount of owner's equity in the
business.
A. 7,500
B. 13,500
C. 7,050
D. 16,450

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By: Taddesse K.