If an Individual Asset Is Increased, Then

question 127

Multiple Choice

If an individual asset is increased, then

• A) there must be an equal decrease in a specific liability.
• B) there must be an equal decrease in equity.
• C) there must be an equal decrease in another asset.
• D) None of these answer choices are correct.

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Definitions:

Work in Process

Inventory that includes goods partially completed in the manufacturing process but not yet ready for sale.

Retained Earnings

The portion of net earnings not paid out as dividends but retained by the company to be reinvested in its core business or to pay debt.

Net Income Column

A financial statement element that shows the difference between total revenues and total expenses of a company.

Balance Sheet

A report detailing a company's assets, liabilities, and owners' equity at a certain moment.