A Transaction Has Been Recorded in the T-Accounts of Vernon $\begin{array}{cc}\text { Land}\\\hline\begin{array}{ll|l}&10,000& \\\end{array}\end{array}$

question 47

Multiple Choice

A transaction has been recorded in the T-accounts of Vernon Company as follows:
$\begin{array}{cc}\text { Land}\\\hline\begin{array}{ll|l}&10,000& \\\end{array}\end{array}$
$\begin{array}{cc}\text {Cash }\\\hline\begin{array}{ll|l}&&10,000 \\\end{array}\end{array}$
Which of the following reflects how this event affects the company's financial statements?
$\begin{array} { | c | c | c | c | c | c | c | c | c | c | c | c | } \hline&&&&&\text { Stk. }&&&&&&\text { Stmt of }\\ &\text { Asset }&=&\text { Liab. }&+&\text { Equity }&\text { Rev. }&-&\text { Exp. }&=&\text { Net Inc. }&\text { Cash Flows }\\\hline A&+&=&+&+&NA&NA&-&NA&=&NA&+FA\\\hline B&+&=&NA&+&+&NA&-&NA&=&NA&-FA\\\hline C&+&=&+&+&NA&NA&-&NA&=&NA&-IA\\\hline D&NA&=&NA&+&NA&NA&-&NA&=&NA&-IA\\\hline\end{array}$

• A) Option A
• B) Option B
• C) Option C
• D) Option D

---

Definitions:

Chapter 11

A provision of the United States Bankruptcy Code that allows businesses to reorganize and try to stay afloat while temporarily holding creditors at bay.

Bankruptcy Action

A legal proceeding involving a person or business that is unable to repay outstanding debts, leading to the legal process of liquidating assets to pay creditors.

Civil Penalties

Fines or sanctions imposed by a civil court on individuals or entities as a consequence of violating statutory law or regulatory requirements.

Clean Air Act

A federal law in the United States aimed at controlling air pollution and protecting air quality.