If total liabilities increased by $90,000 and stockholders' equity increased by $30,000 during a period of time, then total assets must change by what amount and direction during that same period?
A)$120,000 decrease
B)$120,000 increase
C)$150,000 increase
D)$180,000 increase

Question

Quizplus · Accepted Answer

According to the accounting equation, Assets = Liabilities + Stockholders' Equity. If liabilities increase by $90,000 and stockholders' equity increases by $30,000, then assets must increase by $90,000 + $30,000 = $120,000.

If Total Liabilities Increased by $90,000 and Stockholders' Equity Increased