During the current year, liabilities of Hayden Travel decreased by $50,000, and equity increased by $75,000 then.
A) Assets at the end of the year total $125,000.
B) Assets at the end of the year total $25,000.
C) Assets increased during the year by $25,000.
D) Assets decreased during the year by $125,000.

Question

Quizplus · Accepted Answer

The decrease in liabilities and increase in equity together mean that assets must have increased by $25,000 (the difference between the two amounts). Therefore, the correct answer is C.

During the Current Year, Liabilities of Hayden Travel Decreased by $50,000