If Total Liabilities Decreased by $40000 and Owner's Equity Decreased

question 209

Multiple Choice

If total liabilities decreased by $40000 and owner's equity decreased by $30000 during a period of time then total assets must change by what amount and direction during that same period?

• A) $70000 decrease
• B) $10000 decrease
• C) $10000 increase
• D) $70000 increase

---

Definitions:

Alarm Phase

The initial reaction of the body to stress, activating the sympathetic nervous system and the fight or flight response.

Blood Pressure

The force exerted by circulating blood on the walls of blood vessels, often measured for health assessment.

General Adaptation Syndrome

A three-stage response (alarm, resistance, exhaustion) that the body goes through when under stress, as proposed by Hans Selye.

Resistance Phase

The second stage of the general adaptation syndrome, characterized by the body's adaptation to a continuous stressor and an attempt to restore homeostasis.