How does receiving a bill to be paid next month for services received affect the accounting equation?
A) assets decrease; stockholders' equity decreases
B) assets increase; liabilities increase
C) liabilities increase; stockholders' equity increases
D) liabilities increase; stockholders' equity decreases

Question

Quizplus · Accepted Answer

Receiving a bill to be paid next month increases liabilities because it represents an obligation to pay in the future, and it decreases stockholders' equity as it reflects an expense incurred, reducing net income.

How Does Receiving a Bill to Be Paid Next Month