A transaction caused an increase in both assets and owners' equity. This transaction could have been:
A) A sale of service to a customer producing revenue.
B) Sale of land for a price less than its cost.
C) Borrowing money from a bank.
D) Sale of land for cash at a price equal to its cost.

Question

Quizplus · Accepted Answer

A sale of service to a customer producing revenue results in an increase in both assets (cash or accounts receivable) and owners' equity (revenue). Option B results in a decrease in assets and equity, C only increases assets and not equity, and D only increases assets but not equity.

A Transaction Caused an Increase in Both Assets and Owners