For the Following Transaction,identify the Type of Change That Would

question 8

Multiple Choice

For the following transaction,identify the type of change that would have occurred in the accounting equation: Assets = Liabilities + Issued Capital + Opening retained profits + Revenue - Expenses - Dividends
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Commission was earned which will be paid for in 4 months' time.

• A) A liability increased and another liability decreased.
• B) An asset decreased and a liability decreased.
• C) An asset increased and revenue increased.
• D) An asset increased and a liability increased.

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Definitions:

Cash Basis

An accounting method where revenues and expenses are recorded when they are actually received or paid, not when they are incurred.

Cash Receipts

The total amount of cash received by a business during a specified period.

Cash Flows

The net amount of cash and cash-equivalents being transferred into and out of a business, used to evaluate its financial health.

Operating Activities

Activities that are part of a company's primary business operations, such as selling goods and services.