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3. States briefly the rules of debit and credit as applied to asset accounts and as applied to liability and owner’s equity account.
5. what requirement is imposed by the double entry system in the recording of any business transaction?
6. Explain the effect of operating profitably on the balance sheet of a business entity.
7. Does net income represent a supply of cash that could be distributed to stockholders in the form of dividends? Explain.
10. when do accountants consider revenue to be realized? what basic question about recording revenue in accounting records is answered by the realization principle?
11. in what accounting period does the matching principle indicate that an expense should be recognized ?
12. Explain the rules of debit and credit with respect to transactions recorded in revenue and expense accounts.
13. what are some of the limitation of a trail balance?
14. How do dividends affect owners equity? are they treated as a business expense? explain
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