What Account Increases When Raw Materials Are Purchased on Account

question 2

Multiple Choice

What account increases when raw materials are purchased on account?

• A)expenses
• B)liabilities
• C)equity
• D)revenue

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Definitions:

Statement Of Stockholder's Equity

A financial report that shows changes in the value of a company's equity over a reporting period, stemming from transactions with shareholders.

Balance Sheet

An account that consolidates the assets, liabilities, and shareholders' equity of a company, reflecting its financial status at a specific time.

Adjusted Trial Balance

A list of all accounts and their balances after adjustments have been made, used to prepare financial statements.

Total Assets

The sum of all assets owned by a company, including both current (short-term) and non-current (long-term) assets, representing the total resources at its disposal.