For the Basic Accounting Equation to Stay in Balance Each

question 55

Multiple Choice

For the basic accounting equation to stay in balance each transaction recorded must

• A) affect two or less accounts.
• B) affect two or more accounts.
• C) always affect exactly two accounts.
• D) affect the same number of asset and liability accounts.

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Definitions:

Seller's Ownership

The legal right of a seller to dispose of goods or property, affirming they have title to the items they are selling.

Accidental Sale

A transaction where goods or property are sold without the seller's intentional consent, often due to a mistake or misunderstanding.

Good-Faith Purchaser

An individual who buys property without knowledge of any existing claims or defects against it, thereby gaining legal protection.

Goods-In-Bailment Contract

An agreement involving the temporary transfer of personal property to another party for a specific purpose.