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24 July, 07:21

An owner withdrawal of $20,000 would: A. decrease owner’s equity and increase assets by $20,000. B. increase owner’s equity and decrease liabilities by $20,000. C. increase liabilities and assets by $20,000.

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  1. 24 July, 11:09
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    C) increase liabilities and assets by $20,000.

    Explanation:

    Any financial transaction affects both assets and liability equally. If asset is increased, liability also is increased and vice-versa.

    In the given problem, Option A and option B states that while one increases, other decreases. which is not possible.

    So option C is correct.
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Home » Business » An owner withdrawal of $20,000 would: A. decrease owner’s equity and increase assets by $20,000. B. increase owner’s equity and decrease liabilities by $20,000. C. increase liabilities and assets by $20,000.
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