For a cleaning job paid in cash, which accounts are affected?

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Multiple Choice

For a cleaning job paid in cash, which accounts are affected?

Explanation:
When you’re paid in cash for a service, two things happen: you gain an asset (cash) and you recognize revenue, which increases owner’s equity. In double-entry accounting, you’d debit cash (assets go up) and credit revenue (which raises equity through higher retained earnings). So the accounts affected are Cash (Asset) and Revenue (part of Equity). The other options aren’t correct because there’s no liability created by simply receiving cash, and equity alone wouldn’t account for the asset increase.

When you’re paid in cash for a service, two things happen: you gain an asset (cash) and you recognize revenue, which increases owner’s equity. In double-entry accounting, you’d debit cash (assets go up) and credit revenue (which raises equity through higher retained earnings). So the accounts affected are Cash (Asset) and Revenue (part of Equity). The other options aren’t correct because there’s no liability created by simply receiving cash, and equity alone wouldn’t account for the asset increase.

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