Revenues are increased with: A. Debits because they decrease stockholder's equity B. Credits because they decrease stockholder's equity C. Credits because they increase stockholder's equity D. Debits because they increase stockholder's equity

Revenues are increased with: A. Debits because they decrease stockholder's equity B. Credits because they decrease stockholder's equity C. Credits because they increase stockholder's equity D. Debits because they increase stockholder's equity

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 16MCQ

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Question

Revenues are increased with:

A. Debits because they decrease stockholder's equity

B. Credits because they decrease stockholder's equity

C. Credits because they increase stockholder's equity

D. Debits because they increase stockholder's equity

Definition Definition Assets available to stockholders after a company's liabilities are paid off. Stockholders’ equity is also sometimes referred to as owner's equity. A stockholders’ equity or book value generally includes common stock, preferred stock, and retained earnings and is an indicator of a company's financial strength.

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Expenses are increased with: A. Debits because they decrease stockholders' equity B. Credits because they decrease stockholders' equity C. Credits because they increase stockholders' equity D. Debits because they increase stockholders' equity
Explain why stockholders’ equity is increased by revenuesand decreased by expenses.
The increases in stockholders' equity attributable to selling services or products to customers are called a.liabilities b.revenues c.expenses d.assets
When expenses exceed revenues in a given period,a. Stockholders’ equity will not be impacted.b. Stockholders’ equity will be increased.c. Stockholders’ equity will be decreased.d. One cannot determine the impact on stockholders’equity without information about the specific revenuesand expenses
Retained earnings: a. Has a normal debit balance. b. Decreases stockholders’ equity. c. Is equal to the balance in cash. d. Increases stockholders’ equity.
Which one of the following normally has a net debit balance? A. Contributed capital that is in shareholders’ equity. B. Retained earnings that is in shareholders’ equity. C. Dividends that decrease retained earnings Revenues that increase retained earnings. D. Revenues that increase retained earnings
Comment critically on the following statement: ‘Equity only increases or decreases as a result of the owners putting more cash into the business or taking some out.’
Leverage is a. The ability to earn a satisfactory return on the investments in the business. b. The ability to pay current debts when they come due. c. The proportion of debt to stockholders' equity. d. Also called profit margin.
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According to the accounting equation, all other things unchanged, which of the following could offset an increase in profits so as to keep the accounting equation balanced? A) Dividends, common shares, or liabilities decrease; alternatively, assets increase. B) Dividends or assets increase; alternatively, common shares or liabilities decrease. C) Dividends, assets, or common shares increase; alternatively, liabilities decrease. D) Dividends, assets, or liabilities increase; alternatively, common shares decrease
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The stockholders' equity will be reduced by all of the following except a.dividends b.expenses c.revenues d.all of these