What Would Be the Effect on the Accounts If the Owner

question 109

Multiple Choice

What would be the effect on the accounts if the owner invested cash into the business?

• A) An asset would be debited and Capital credited.
• B) Withdrawals would be debited and an asset credited.
• C) An asset would be debited and a revenue credited.
• D) A Revenue would be debited and Capital credited.

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Definitions:

FDIC

The Federal Deposit Insurance Corporation (FDIC) is a United States government agency created in 1933 to insure deposits in banks and thrift institutions for at least $250,000 per depositor, per insured bank, for each account ownership category.

Deposit Insurance

A guarantee provided typically by a government agency to protect depositor's funds up to a certain amount in the event of a bank failure.

Banking Crisis

A situation in which a large part of the banking sector becomes insolvent, leading to a loss of confidence and potentially a run on banks.

FDIC

The Federal Deposit Insurance Corporation, a U.S. government agency that insures deposits in banks and thrift institutions to maintain public confidence and encourage stability in the financial system.