Chapter 03 - The Accounting Cycle: Capturing Economic Events23. An increase in a liability is recorded by a credit; an increase in owners' equity by a debit.
24. Revenues increase owners' equity and are, therefore, recorded by crediting the revenues account.
25. The accrual basis of accounting recognizes expenses only when they are paid.
26. Every transaction which affects an income statement account also affects a balance sheet account. True False
27. A trial balance that balances provides proof that all transactions were correctly journalizedand posted to the ledger.
28. A trial balance proves that equal amounts of debits and credits were posted to the ledger.
29. Dividends are an expense to a corporation and appear on the income statement.
30. A CEO or CFO associated with fraudulent financial reporting could be fined but not imprisoned under the Sarbanes Oxley Act. True False