XYZ CorpMade Cash Sales to Customers

question 65

Multiple Choice

XYZ Corp.made cash sales to customers.What effect does this transaction have on the accounting equation?

• A)Liabilities increase and stockholders' equity increases.
• B)There is no effect on the accounting equation as one asset account increases while another asset account decreases.
• C)Assets increase and liabilities increase.
• D)Assets increase and stockholders' equity increases.

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Definitions:

Save a Life

Save a Life refers to actions or interventions taken to prevent someone from dying.

Marginal Cost Curve

A graphical representation showing how the cost of producing one more unit of a good changes as production volume varies.

Upward Sloping

A line on a graph that shows an increase in a certain variable as another variable increases.

Sunk Costs

Costs that have already been incurred and cannot be recovered, and therefore, should not be considered in making future economic decisions.