[janemorales]

Indicate for each of the following items whether it would appear on a balance sheet (BS) or an income statement (IS). If a balance sheet item, is it an asset (A), a liability (L), or an owners' equity (OE)?

A/P - BS/L
Sales Revenue - IS
A/R - BS/A
Advertising expense - IS
Cash - BS/A
Supplies - BS/A
Consulting revenue - BS/A
Land - BS/A
Capital Stock - BS/OE
Rent Expense - IS
Equipment - BS/L
Interest Receivable - BS/A
Mortgage Payable - BS/L
Notes Payable - BS/OE
Buildings - BS/A
Salaries & wages expense - IS
Retained earnings - BS/OE
Utilities expense - IS

Did I classify these correctly?

[morgaine300]

Consulting revenue (hint, hint)

Equipment is a thing that is owned, making it an asset. Equipment does not represent something owed to someone else.

Note payable -- a payable is a payable is a payable. They're ALL liabilities.

Make sure you understand the definitions of these and don't try to memorize them all. They can change names and you will have way too many accounts added as you go to just memorize them all.

Assets are things the company owns or has some type of claim to. It's something with value that can be utilized or turned into cash in the future. e.g. Cash can be used as is. Things like equipment, land & furniture are resources to be used. (Not something owed.) Something like receivables falls into "have a claim to" and can be turned into cash. Even Prepaid Insurance has a value into the future, its value being coverage. For right now, most of your assets are things. Definitely, something that is an object like equipment is an asset.

Liabilities represent how much is owed (generally a payable of some sort) or some other obligation to be met. So ALL payables are liabilities. And anything else that represents an obligation is a liability, like unearned fees.