If the Amount of Net Income for the Current Period

question 47

Multiple Choice

If the amount of net income for the current period is less than the amount of the owner's withdrawals, there will be a(n)

• A) decrease in the Cash account.
• B) increase in the owner's Capital account.
• C) decrease in the owner's Capital account.
• D) increase in the Cash account.
• E) increase in liabilities on the balance sheet.

---

Definitions:

Excise Tax

A tax imposed on specific goods, services, and activities, such as gasoline, alcohol, and tobacco, often included in the purchase price, used by governments to generate revenue or discourage consumption.

Regressive

A term especially used in taxation to describe a situation where the tax rate decreases as the amount subject to taxation increases.

Progressive

A political and social philosophy advocating for reforms and changes that aim to address inequality and improve the social welfare of the population.

National Debt

The complete monetary sum borrowed by a nation's executive body through various sources.