Problem 1-2 Select the answer that best satisfies the question. 1. The accounting equation is a. Assets + Liabilities Owner's Equity b. Assets = Liabilities - Owner's Equity c. Assets = Liabilities + Owner's Equity d. Assets = Liabilities/Owner's Equity 2. An expense is a. the inflow of assets as a result of providing a good service b. a consumed asset c. an asset that has future use d. revenue 3. A commonly used asset account title is a. office supplies b. accounts payable c. office supplies expense d. unearned service revenue 4. A debit a. always increases an account b. always decreases an account c. is the left side of the t-account d. is the right side of the t-account 5. A corporation is a. a separate legal entity b. taxed as a business c. both a and b d. neither a or b