A Business Receives a Bill for Services Rendered from One

question 9

Multiple Choice

A business receives a bill for services rendered from one of its suppliers. The business will pay the supplier next month. When the business receives the bill from its supplier, how does this affect the accounting equation?

• A)Assets decrease; owners' equity decreases.
• B)Assets increase; liabilities increase.
• C)Liabilities increase; owners' equity increases.
• D)Liabilities increase; owners' equity decreases.

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Definitions:

Advertising Extent

The scope or range of advertising efforts, including the diversity of mediums used and the breadth of target audiences reached.

Oligopoly

describes a market structure in which a few firms dominate the industry, influencing price and production levels.

Competitive Market

A market structure characterized by a large number of sellers and buyers, where no single entity has significant power to influence prices or market conditions.

Monopolistic Competition

A market structure characterized by many firms selling products that are similar but not identical, allowing for competition based on non-price factors.