Which of the Following Transactions Would Cause an Asset to Decrease

question 172

Multiple Choice

Which of the following transactions would cause an asset to decrease and the owner's equity to decrease?

• A) The business provided services to a cash customer.
• B) The business bought supplies for cash.
• C) The owner withdrew cash from the business.
• D) The business bought supplies on account.

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Definitions:

Retention Cue

A retention cue is a stimulus or reminder that aids in the recall of information from memory.

Vivid Memory

A particularly clear and detailed memory of an event or moment, often with emotional significance, that remains strong over time.

Ignoring Base Rates

Involves disregarding statistical information in favor of anecdotal evidence when making judgments.

Availability Bias

A cognitive bias that makes people overestimate the importance of information that is available to them, leading to a misrepresentation of reality.