Which of the Following Statements Is Correct

question 35

Multiple Choice

Which of the following statements is correct?

• A) The left side of a T-account is the credit side.
• B) Debits decrease asset and expense accounts, and increase liability, equity, and revenue accounts.
• C) The left side of a T-account is the debit side.
• D) Credits increase asset and expense accounts, and decrease liability, equity, and revenue accounts.
• E) In certain circumstances the total amount debited need not equal the total amount credited for a particular transaction.

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Definitions:

Closing Entry

A journal entry made at the end of an accounting period to transfer the balance from temporary accounts to permanent ones, prepping the books for the next period.

Withdrawn

Refers to the act of removing funds from an account or canceling a financial transaction or operation.

Salaries

Regular payments made to employees for their service during a set period, not depending on hours worked.

Partnership

A legitimate business setup where two or more individuals collaborate in managing the business and dividing its profits.