A Business Owner Took a Withdrawal

question 26

Multiple Choice

A business owner took a withdrawal. Which of the following would be TRUE?

• A)Total assets would increase.
• B)Profit would decrease.
• C)Owners' equity would decrease.
• D)There would be no effect on total assets.

---

Definitions:

Contract Size

The deliverable quantity of commodities or financial instruments specified in a contract that an investor agrees to buy or sell.

Hedge Strategy

Investment strategies designed to reduce the potential for loss in an investment portfolio by making counterbalancing investments or using financial instruments like options and futures.

Short Corn Futures

A financial contract obligating the seller to deliver corn at a future date, typically used to hedge or speculate on falling corn prices.

Shorting Index Futures

The practice of selling index futures contracts with the expectation that the underlying index will decline in value, aiming to profit from the decrease.