Why Are Expenses Increased with a Debit

question 98

Multiple Choice

Why are expenses increased with a debit?

• A) They are always paid by cash, which is credited. Thus expenses are debited.
• B) They decrease stockholders' equity thus they increase with a debit.
• C) They have the same rules of debits and credits as the retained earnings account.
• D) None of the statements are correct.

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