A Bill Is Received for Electric Service;the Charge for the Electricity

question 29

Multiple Choice

A bill is received for electric service;the charge for the electricity is recorded,but payment will be made later.For this transaction,identify the effect on the accounting equation.

• A)Assets increase and liabilities increase.
• B)Assets increase and stockholders' equity increases.
• C)Liabilities increase and stockholders' equity decreases.
• D)Liabilities decrease and assets decrease.

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Definitions:

Four

The number following three and preceding five, represented in Roman numerals as IV and in Arabic numerals as 4.

Milli-

A prefix in the metric system denoting one thousandth (1/1000) of the unit it precedes.

One Thousandth

A fraction or measure representing one part out of a thousand parts.

Meta-

A prefix meaning beyond, after, or changing; often used in academic and scientific contexts to indicate change or transformation.