If the Liabilities of a Company Increased by $55,000 During

question 141

Multiple Choice

If the liabilities of a company increased by $55,000 during a month and the stockholders' equity decreased by $21,000 during that same month,did assets increase or decrease and by how much?

• A)$34,000 increase
• B)$55,000 increase
• C)$34,000 decrease
• D)$76,000 increase

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Definitions:

Financial Statements

Reports that summarize the financial performance and health of a business including balance sheet, income statement, and cash flow statement.

Balance Sheet

A summary record that outlines a firm's assets, liabilities, and equity held by shareholders at a specific timeframe, showing its financial status.

Statement of Owner's Equity

A financial statement that outlines the changes in the equity of a company over a specific period, including contributions, withdrawals, and the net income or loss.

Worksheet

An accounting tool used for planning and preparing financial statements, allowing accountants to adjust and update figures through a series of adjustments.