Test Your Accounting Basics: Quiz!

Controls all revenue reporting for the cash basis of accounting

Determines when revenue is credited to a revenue account

Is in not in conflict with the cash method of accounting

True

False

True

False

True

False

Debit Insurance Expense, $10,000; credit Prepaid Insurance, $10,000

Debit Insurance Expense, $16,000; credit Prepaid Insurance, $16,000

Debit Prepaid Insurance, $10,000; credit Insurance Expense, $10,000

Accrual basis

Account basis

Cash basis

Supplies Expense, debit; Supplies, credit

Accounts Payable, debit; Supplies, credit

Accounts Receivable, debit;supplies, credit

Net income or loss will be properly reported on the income statement

Net income or loss will always be overestimated.

Net income or loss will always be underestimated.