Boxes R' Us paid $2,000 in salaries and wages for February. This transaction will
A) increase expenses and decrease revenue.
B) increase expenses and increase liabilities.
C) decrease assets and increase expenses.
D) decrease assets and expenses.

Question

Quizplus · Accepted Answer

The transaction of paying salaries and wages for February will decrease the assets of Boxes R' Us (cash or bank balance) and increase their expenses (wages and salaries expense). Therefore, option C is the correct answer. Option A is incorrect because this transaction only increases expenses, not decrease revenue. Option B is incorrect because it is not related to liabilities. Option D is incorrect because it is incomplete and does not provide proper information about the impact on assets and expenses.

Boxes R' Us Paid $2,000 in Salaries and Wages for February