Chapter 1 — Foundations & The Accounting Equation

Account Sorter

Learning Outcome Covered: 1.2a
💰 Assets
🤝 Liabilities
📈 Revenue

🎯 Objective

Read the account name and sort it into the correct category: Assets, Liabilities, Equity, Revenue, or Expenses.

🎮 How to Play

  1. Read the account name shown
  2. Tap the correct category button
  3. Get 10 correct to win!

How stars work: 3 stars = you passed with no mistakes · 2 stars = you passed · 1 star = you finished, but did not pass.

📚 Learning: Account Categories

Assets

What: Things the company OWNS.

Example: Cash, Supplies, Prepaid Insurance, Prepaid Rent, Equipment, Vehicles.

Liabilities

What: What the company OWES.

Example: Accounts Payable, Notes Payable, Unearned Revenue.

Equity

What: Owner's net worth.

Example: Owner's Capital, Drawings, Stock.

Revenue

What: Money EARNED.

Example: Service Revenue, Sales.

Expenses

What: Costs to run business.

Example: Rent Expense, Salaries Expense, Utilities Expense.

⚠️ Names that trick people

  • Prepaid Insurance is an asset. The business paid ahead and still has cover left to use.
  • Prepaid Rent is an asset too. The rent is paid ahead, for months still to come.
  • Unearned Revenue is a liability, not a revenue. The customer has paid, but the business has not done the work yet.
  • Supplies is an asset — what you still have. Supplies Expense is what you used up.

💡 Quick Tips

  • Asset? Can you touch/collect it?
  • Liability? Do we owe someone?
  • Revenue? Did we do work/sell goods?
  • Expense? Did we use it up?
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Round
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🔥 Streak: 0

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