How Is the Accounting Equation Affected When a Partner Withdraws

question 60

Multiple Choice

How is the accounting equation affected when a partner withdraws cash?

• A) Both equity and assets decrease; liabilities are not affected.
• B) Assets increase and equity decreases; liabilities are not affected.
• C) Both assets and liabilities decrease; equity is not affected.
• D) Liabilities decrease and assets increase; equity is not affected.

---

Definitions:

Status Report

A formal report detailing the current state of a project, including completed tasks and future plans.

Incident Report

A formal record describing the details of an unexpected event, often used for safety and quality control processes.

Directive

An instruction or order given by an authority, meant to guide actions or establish procedures within an organization or community.

Comprehensiveness

The characteristic of being thorough and encompassing most or all parts or facets of something.