If Total Liabilities Increased by $25,000 and Shareholders' Equity Increased

question 37

Multiple Choice

If total liabilities increased by $25,000 and shareholders' equity increased by $5,000 during a period of time, then total assets must change by what amount and direction during that same period?

• A) $20,000 increase
• B) $25,000 increase
• C) $30,000 increase
• D) $20,000 decrease

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Definitions:

Attitude-Behavior Relationship

The connection between an individual's beliefs or feelings towards an object, person, or situation, and how they subsequently behave.

Attitudes Develop

The process by which individuals form opinions and dispositions towards various phenomena based on experiences, information, and social influences.

Postdecisional Dissonance

The psychological conflict or discomfort experienced after making a difficult decision, often leading to regret or rationalization of the choice.

Balance Theory

A psychological theory suggesting that people prefer harmony and consistency in their views, beliefs, and sentiments, and will change or modify them to achieve balance.