1) Explain the accounting equation and define its terms. 2) What distinguishes liabilities from equity? TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false. 3) Owner financing refers to resources contributed by creditors or lenders. 3) MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 4) The revenue recognition principle: A) Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold. B) Prescribes that a company record the expenses it incurred to generate the revenue reported. C) Provides guidance on when a company must recognize revenue. D) Prescribes that a company report the details behind financial statements that would impact users' decisions. E) Prescribes that accounting information is based on actual cost. 4) 5) Determine the net income of a company for which the following information is available for the month of July. 5) Employee salaries expense Interest expense Rent expense Consulting revenue $180,000 10,000 20,000 400,000 A) $400,000. B) $610,000. C) $230,000. D) $190,000. E) $210,000