On June 1, 2015 Ted Leo Buys a Copier Machine

question 30

Multiple Choice

On June 1, 2015 Ted Leo buys a copier machine for his business and finances this purchase with cash and a note. When journalizing this transaction, he will

• A)use two journal entries.
• B)make a compound entry.
• C)make a simple entry.
• D)list the credit entries first, which is proper form for this type of transaction.

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Definitions:

Net Income

The net income of a business following the subtraction of all costs, such as operating expenses and taxes, from its overall revenue.

Net Loss

The deficit that results when total expenses exceed total revenues in a specific accounting period, indicating a decrease in net assets.

Accounting Equation

A fundamental principle of accounting that states assets are equal to the sum of liabilities and stockholders' equity, expressed as Assets = Liabilities + Stockholders' Equity.

Landscaping Supplies

Various materials and tools used for garden and landscape design, maintenance, and construction.