Asked by Santiago Quirós on Jul 22, 2024
Verified
Received payment from a customer on account
A)Increase assets, increase liabilities
B)Increase liabilities, decrease stockholders' equity
C)Increase assets, increase stockholders' equity
D)No effect
E)Decrease assets, decrease liabilities
F)Decrease assets, decrease stockholders' equity
Accounting Equation
The basic principle that equates assets with the sum of liabilities and shareholders' equity, formulated as Assets = Liabilities + Equity.
Liabilities
Financial obligations or debts that an entity owes to external parties, which must be settled over time through the transfer of economic benefits.
Stockholders' Equity
The residual interest in the assets of a corporation after deducting liabilities, representing owners' claims on the company's resources.
- Understand the effects of different transactions on the accounting equation.
Verified Answer
RS
Learning Objectives
- Understand the effects of different transactions on the accounting equation.