S PROBLEM 1: TRUE OR FALSE 1. The accounting cycde represents the steps followed by the accountant in recording, classifying, summarizing and communicating financial information. 2. Extermal events are those that involve the entity and an extemal party. 3. Losses from natural disasters are considered external events. 4. The sale of gooHs is usually evidenced by a source document called 'sales invoice'. 5. To signify your intention to acquire goods from a supplier, you would prepare a source document called 'sale order'. 6. All jourmal entries affect at least two accounts and are recorded in both debit and credit format. 7. In some instances, a journal entry can be recorded only through a debit and no credit, or vice-versa. 8. A compound journal entry is one that contains two or more debits or two or more credits. 9. A business owner contributes cash to the business. This transaction increases only te 'owner's equity' account of the business. 10.Entity A makes a sale. Entity A will most likely record the sale in two journal entries -one to record sales revenue and one to record cost of sales