A Company Provided Services to Customers Then Sent Them Invoices

question 157

Multiple Choice

A company provided services to customers then sent them invoices for the amounts owed. What effect does this transaction have on the accounting equation?

• A)Assets and liabilities increase.
• B)Assets and retained earnings increase.
• C)Liabilities decrease and contributed capital increases.
• D)Assets and liabilities decrease.

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Definitions:

Publicly Traded

Refers to companies whose shares are bought and sold on public stock exchanges.

Venture Capitalists

Investors who provide capital to start-up companies and small businesses with perceived long-term growth potential.

Pension Funds

Pooled monetary contributions from different individuals or entities to invest in securities, designed to generate future retirement income for participants.

Long-Term Investors

Individuals or entities that hold investments for an extended period, typically with the aim of achieving long-term objectives.