Which of the Following Entries Records the Investment of Cash

question 58

Multiple Choice

Which of the following entries records the investment of cash by John, owner of a sole proprietorship?

• A) Debit John, Capital; credit Cash
• B) Debit Cash; credit John, Withdrawals
• C) Debit John, Withdrawals; credit Cash
• D) Debit Cash; credit John, Capital

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Definitions:

Newly Created Securities

Financial instruments such as stocks or bonds that have been recently issued and are available for investment.

Original Issuer

The entity or organization that initially offers or issues a financial instrument or security to the public.

Special Relationship

A legal concept denoting a duty of care that exists between parties, beyond general public duty.

Reporting Issuer

A company whose securities are traded on a stock exchange and must regularly disclose financial and other significant information.