Decreases in shareholders' equity result from:
A) a net income during the period
B) owner investments and a net loss during the period
C) a net loss during the period
D) owner investments

Question

Quizplus · Accepted Answer

Shareholders' equity will decrease when there is a net loss during the period, as it represents a decrease in the company's net assets. A net income during the period (choice A) will increase shareholders' equity. Owner investments (choice D) will also increase shareholders' equity, but it will not result in a decrease. Choice B is incorrect because owner investments will increase shareholders' equity, not decrease it.

Decreases in Shareholders' Equity Result From