The Total Liabilities of Hickory Construction Co

question 139

Multiple Choice

The total liabilities of Hickory Construction Co.decreased by $90,000 during the month of August 2022.Stockholders' equity increased by $30,000 during this period.By what amount and in what direction must total assets have changed during August?

• A)$120,000 increase
• B)$60,000 decrease
• C)$60,000 increase
• D)$90,000 decrease

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Definitions:

Check

A negotiable instrument, commonly used for transactions, instructing a bank to pay a specific amount from the drawer's account to the payee or bearer.

Warranties

Legally binding promises or guarantees about the condition, quality, or performance of goods or services sold, which are enforceable under the sale of goods laws.

Indorsement

A signature or stamp on a financial document transferring the rights and responsibilities from one party to another.

Transferor

The party who transfers a right, title, or interest in property to another party, known as the transferee.