Investments by Stockholders Have What Effect on the Accounting Equation

question 54

Multiple Choice

Investments by stockholders have what effect on the accounting equation?

• A)Assets increase and liabilities increase.
• B)Expenses increase and liabilities increase.
• C)Assets increase and revenues increase.
• D)Assets increase and stockholders' equity increases.

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Definitions:

Impracticable

A situation or task that is impossible to carry out or accomplish due to practical limitations.

Reasonable Commercial Standards

The accepted norms and practices within a specific industry that are considered fair and appropriate.

Honesty in Fact

A concept referring to the genuine intention or belief without intent to deceive in transactions or dealings.

Conform to Contract

The requirement that goods or services supplied under a contract must meet the specifications agreed upon in the contract.