Asked by Summer Bourbon on May 07, 2024
Verified
Earning revenue
A) increases assets, increases stockholders' equity
B) increases assets, decreases stockholders' equity
C) increases one asset, decreases another asset
D) decreases assets, increases liabilities
Earning Revenue
The income a company generates from its business activities, typically from the sale of goods or services.
Stockholders' Equity
The residual interest in the assets of a corporation after deducting liabilities, representing the owners' claim on the business assets.
Assets
Economic resources owned or controlled by a business, expected to provide future benefits.
- Attain an understanding of the fundamentals of revenue, expenses, and equity as they pertain to accounting.
Verified Answer
AO
Andrew OehlerMay 09, 2024
Final Answer :
A
Explanation :
Earning revenue increases the company's assets by increasing cash or accounts receivable. The increase in assets also leads to an increase in stockholders' equity, as revenue is a form of income for the business.
Learning Objectives
- Attain an understanding of the fundamentals of revenue, expenses, and equity as they pertain to accounting.