If Total Liabilities Decreased by $105,000 and Stockholders' Equity Decreased

question 80

Multiple Choice

If total liabilities decreased by $105,000 and stockholders' equity decreased by $35,000 during a period of time, then total assets must change by what amount and direction during that same period?

• A)$140,000 increase
• B)$70,000 decrease.
• C)$140,000 decrease.
• D)$70,000 decrease

---

Definitions:

Deemed Worthless

A term referring to assets that have become valueless and are recognized as a loss for tax purposes.

Long-Term Loss

A loss realized from the sale of an asset held for more than one year, which can offset long-term capital gains.

Short-Term Loss

A financial loss realized on the sale of an asset held for one year or less, used to offset capital gains and reduce taxable income.

Single Category Average

A measure that represents the average value within a specific, singular category of data.