Asked by Grace Hummel on Jul 18, 2024
Verified
Which of the following will increase owner's equity?
A) expenses > revenues
B) the owner draws money for personal use
C) revenues > expenses
D) cash is received from customers on account
Owner's Equity
The residual interest in the assets of the entity after deducting liabilities, representing the ownership stake of the owners.
Revenues
The total income generated from normal business operations and other activities over a specific time period.
Expenses
The costs incurred in the process of generating revenue, including operational, administrative, and sales costs.
- Determine the effect of transactions on the equity of the owner.
Verified Answer
AD
Aidid DannielJul 24, 2024
Final Answer :
C
Explanation :
Revenues > expenses indicates that the business is earning more than it is spending, which increases the owner's equity.
Learning Objectives
- Determine the effect of transactions on the equity of the owner.
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