Which of the following statements is not true?O a. Expenses increase stockholders' equity.O b. The effect of every transaction is an increase or a decrease in one or more of the accounting equation elements (assets, liaO c. The two sides of the accounting equation are always equal.O d. Stockholders' equity is increased by stockholders' investments and is decreased by dividends.

The accounting equation states that assets equal to sum of liabilities and equity.

Answered: Which of the following statements is…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 5MCQ

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Similar questions

When the Dividends account increases, how is the Accounting Equation impacted? Decrease liabilities O No effect O Increase assets O Decrease stockholders' equity
Performing services on account: Select one: O A. decreases revenues and decreases stockholders' equity. B. increases assets and decreases stockholders' equity. O C. decreases both assets and liabilities. D. increases both net income and stockholders' equity.
What is the impact on the accounting equation when stock is issued, in exchange for assets?A. both sides increaseB. both sides decreaseC. only the Asset side changesD. neither side changes
Which of the following items reduces Net Income? (check all that apply) Revenues Stockholders' Equity Dividends Liabilities Expenses
Which of the following statements is true about vertical analysis? O a. It is not useful for analyzing changes in financial statements over time O b. It is useful in analyzing relationships within a financial statement. O c. Each line item is expressed as a percent of stockholders' equity. O d. The amount of change in each line item is calculated.
Net Income: A) Decreases equity. B) Represents the amount of assets stockholders put into a business. C) Equals assets minus liabilities. D) Is the excess of revenues over expenses. E) Represents stockholders' claims against assets.
Performing services on account: increases assets and decreases stockholders' equity. decreases revenues and decreases stockholders' equity. O decreases both assets and liabilities. O decreases assets and increases stockholders' equity increases both net income and stockholders' equity.
Which one of the following will increase shareholders' equity, all else held constant? Select one: a. A sale of inventory at a profit. b. The collection of an account s receivable. c. A payment on a loan. d. A purchase of equipment on account. e. The declaration of a stock dividend.
Which of the following statements concerning retained earnings is true?a. Retained earnings is the difference between revenues and expenses.b. Retained earnings is increased by dividends and decreased by net income.c. Retained earnings represents accumulation of the income that has not been distributed as dividends.d. Retained earnings is reported as a liability on the balance sheet.
Which of the following regarding retained earnings is false?a. Retained earnings is increased by net income.b. Retained earnings is a component of stockholders’equity on the balance sheet.c. Retained earnings is an asset on the balance sheet.d. Retained earnings represents earnings not distributed tostockholders in the form of dividends
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
For each transaction, indicate the change, if any, in total assets and total equity. If equity changes, indicate whether the change was reflected as a component of net income, or directly within the stockholders' equity portion of the balance sheet. Remember that the change in total assets must agree with the change in total equity. How would I complete the table?

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