Equity in a Business Increases as a Result of Which

question 59

Multiple Choice

Equity in a business increases as a result of which of the following?

• A) Payments of cash to the owners.
• B) Losses from unprofitable operation of the business.
• C) Earnings from profitable operation of the business.
• D) Borrowing from a commercial bank.

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Definitions:

Fixed Costs

Expenses that do not change with the volume of production or sales, such as rent, salaries, and insurance.