When a Liability Increases, Which of the Following Is Correct

question 5

Multiple Choice

When a liability increases, which of the following is correct?

• A) An expense may increase.
• B) An asset may decrease.
• C) Shareholders' equity may increase.
• D) Revenue may increase.

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Definitions:

State Government

The government of an individual state within the United States, which operates independently in managing local affairs and responsibilities.

Supreme Court

The highest federal court in the United States, with ultimate appellate jurisdiction over all federal and state court cases that involve a point of constitutional law.

Fourteenth Amendment

An amendment to the U.S. Constitution that grants citizenship to all persons born or naturalized in the United States and ensures equal protection under the law.

Due Process Clause

A legal principle that guarantees fair treatment through the normal judicial system, especially as a citizen's entitlement.