If the Assets of a Business Increased $9,000 During a Period

question 29

Multiple Choice

If the assets of a business increased $9,000 during a period of time and its liabilities increased $5,000 during the same period, equity in the business must have:

• A)Decreased $6,000.
• B)Increased $14,000.
• C)Decreased $14,000.
• D)Increased $4,000.
• E)Decreased $4,000.

---

Definitions:

Creditors

Individuals or organizations to whom a company or person owes money for services or goods provided.

Capital Deficiency

A financial situation where a company's liabilities exceed its assets, indicating potential insolvency.

Income Ratios

Financial metrics comparing various components of a company's income statement to assess performance and profitability.