Match Each Transaction with Its Effect on the Accounting Equation

question 77

Multiple Choice

Match each transaction with its effect on the accounting equation. Each letter may be used more than once.
-Paid wages

• A)Increase assets, increase liabilities
• B)Increase liabilities, decrease owner's equity
• C)Increase assets, increase owner's equity
• D)No effect
• E)Decrease assets, decrease liabilities
• F)Decrease assets, decrease owner's equity

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Definitions:

Chapter 7 Bankruptcy

involves the liquidation of a debtor's non-exempt assets by a trustee to pay creditors, part of the U.S. Bankruptcy Code.

Chapter 13

refers to a part of the U.S. Bankruptcy Code that enables individuals with a regular income to develop a plan to repay all or part of their debts.

Chapter 7

A provision of the bankruptcy code that provides for "liquidation," whereby a debtor's assets are distributed to creditors.

Repayment Plan

A structured schedule agreed upon for paying back borrowed money.