Credits to revenue accounts ultimately result in a(n):
A)decrease in stockholders' equity and assets.
B)increase in stockholders' equity and assets.
C)decrease in assets and liabilities.
D)increase in liabilities and assets.

Question

Quizplus · Accepted Answer

Credits to revenue accounts indicate an increase in revenue. This increase in revenue ultimately results in an increase in stockholders' equity (as revenue is a component of equity) and assets (as revenue is recognized as an inflow of economic resources). Therefore, choice B is the correct answer.

Credits to Revenue Accounts Ultimately Result in A(n)