Which of the Following Statement About the Rules of Debits

question 88

Multiple Choice

Which of the following statement about the rules of debits and credits is correct?

• A) An asset is increased by a debit.
• B) Dividends are decreased by debits.
• C) A liability is increased by a debit.
• D) Revenue is increased by a debit.

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Definitions:

Cash Disbursements

The outflow of cash to pay expenses, purchase assets, or repay debts.

Floor Plan

In finance, it refers to a type of short-term loan used by retailers to purchase high-cost inventory such as automobiles. In architecture, it's the scale diagram of the arrangement of rooms in a building.

Secured Inventory Loan

A loan that is backed by the borrower's inventory as collateral to reduce the lender's risk.