Jane Is an Accountant Operating as a Sole Proprietor

question 44

Multiple Choice

Jane is an accountant operating as a sole proprietor. On 14 February she pays $600 wages in cash to her receptionist for work done during the first half of the month. Which of the following represents the effect of this transaction on the accounting equation?

• A) Decrease in cash at bank $600; decrease in liability accounts payable $600.
• B) Decrease in cash at bank $600; increase in liability accounts payable $600.
• C) Decrease in cash at bank $600; increase in equity $600.
• D) Decrease in cash at bank $600; decrease in equity $600.

---

Definitions:

Oral Pills

A form of medication taken by mouth, specifically used here to likely refer to contraceptives used to prevent pregnancy.

Hormonal Methods

Contraceptive methods that use hormones to prevent pregnancy, such as the pill, patch, injection, and hormonal IUDs.

Oral Contraceptives

Medications taken orally to prevent pregnancy, commonly known as birth control pills.

Vaginal Ring

A vaginal form of reversible, hormonal birth control. Commonly referred to as NuvaRing.