What effect does "recognizing accrued interest revenue at the end of the accounting period" have on the accounting equation?
A) Assets increase and stockholders' equity decreases.
B) Assets increase and stockholders' equity increases.
C) Assets decrease and liabilities decrease.
D) Liabilities increase and stockholders' equity decreases.

Question

Quizplus · Accepted Answer

Recognizing accrued interest revenue at the end of the accounting period will increase the asset account (accounts receivable) and increase the revenue account (interest revenue). This will result in an overall increase in the stockholders' equity. Therefore, assets increase and stockholders' equity increases.

What Effect Does "Recognizing Accrued Interest Revenue at the End